UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
þ QUARTERLY REPORT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 30, 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 333-148076
RAPTOR TECHNOLOGY GROUP, INC.
(Exact name of registrant as specified in its charter)
|
Nevada |
20-8-182 |
| (State or Other Jurisdiction of Incorporation of Organization) | (I.R.S. Employer Identification No.) |
|
409 – 903 19th Avenue SW, Calgary, Alberta, T2T OH8 |
403-399-6402 |
| (Address of principal executive offices) (ZIP Code) | (Registrant’s telephone number, including area code) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company þ
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes þ No o
Number of common shares outstanding at January 14, 2011: 63,356,538
Table of Contents
2
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
RAPTOR TECHNOLOGY GROUP, INC.
(formerly Branded Beverages, Inc.)
Financial Statements
(Expressed in United States dollars)
November 30, 2010
Index
3
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| (formerly Branded Beverages, Inc.) |
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| (A development stage company) |
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| Balance Sheets |
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| (Expressed in U.S. Dollars) |
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| November 30, 2010 |
| August 31, 2010 |
| ASSETS |
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| Current |
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| Cash and cash equivalents | $ | 15,570 | $ | 17,324 |
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| Website Development Costs, net of amortization of $20,157 |
| - |
| 353 |
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| Total assets | $ | 15,570 | $ | 17,677 |
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| LIABILITIES AND STOCKHOLDERS' EQUITY |
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| Liabilities |
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| Current |
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| Accounts payable and accrued liabilities |
| 11,464 |
| 1,151 |
| Due to related parties (Note 4) |
| 185,084 |
| 165,584 |
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| Total liabilities |
| 196,548 |
| 166,735 |
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| Stockholders' Equity (Deficiency) |
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| Share capital |
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| Authorized: |
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| 100,000,000 preferred shares, par value $0.0001 |
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| 100,000,000 common shares, par value $0.0001 |
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| Issued and outstanding: |
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| Nil preferred shares |
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| 191,456,538 common shares |
| 19,146 |
| 19,146 |
| Additional paid-in capital |
| 93,865 |
| 93,865 |
| (Deficit) accumulated during the development stage |
| (293,989) |
| (262,069) |
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| Total stockholders' equity (deficiency) |
| (180,978) |
| (149,058) |
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| Total liabilities and stockholders' equity (deficiency) | $ | 15,570 | $ | 17,677 |
The accompanying notes are an integral part of these financial statements.
F-1
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| (formerly Branded Beverages, Inc.) |
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| (A development stage company) |
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| Statements of Stockholders' Equity (Deficiency) |
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| For the period from August 30, 2007 (inception) to November 30, 2010 |
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| (Expressed in U.S. Dollars) |
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| Share |
| (Deficit) |
| Total | |
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| Preferred stock | Common stock | Additional |
| subscriptions | accumulated during | stockholders' | |||||||
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| Shares |
| Amount | Shares |
| Amount | paid-in capital |
| received | development stage |
| deficiency | ||
| Issuance of common stock for settlement of debt, August 31, 2007, $0.0002 per share | - | $ | - | 168,000,000 | $ | 16,800 | $ | 23,200 | $ | - | $ | - | $ | 40,000 |
| Film property transferred from a shareholder
| - |
| - |
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| - |
| (29,187) |
| - |
| - |
| (29,187) |
| Comprehensive income (loss)
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| Loss for the period
| - |
| - |
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| - |
| - |
| - |
| (1,055) |
| (1,055) |
| Balance, August 31, 2007
| - | $ | - | 168,000,000 | $ | 16,800 | $ | (5,987) | $ | - | $ | (1,055) | $ | 9,758 |
| Issuance of common stock for settlement of debt, September 8, 2007, $0.0002 per share | - |
| - | 2,100,000 | | 210 | | 290 | | - | | - | | 500 |
| Share subscriptions | - |
| - | - | | - | | - | | 5,388 | | - | | 5,388 |
| Comprehensive income (loss) |
| |
| | | | | | | | | | | |
| Loss for the year
| - |
| - | - |
| - |
| - |
| - |
| (54,372) |
| (54,372) |
| Balance, August 31, 2008
| - | $ | - | 170,100,000 | $ | 17,010 | $ | (5,697) | $ | 5,388 | $ | (55,427) | $ | (38,726) |
| Share Subscriptions | - | | - | - | | - | | - | | 96,310 | | - | | 96,310 |
| Comprehensive income (loss) | | | | | | | | | | | | | | |
| Loss for year | - | | - | - | | - | | - | | - | | (73,876) | | (73,876) |
| Balance, August 31, 2009 | - | $ | - | 170,100,000 | $ | 17,010 | $ | (5,697) | $ | 101,698 | | (129,303) | | (16,292) |
| Issuance of common stock in connection with IPO @ $0.005 per share on October 28, 2009 | - | | - | 21,356,538 | | 2,136 | | 99,562 | | (101,698) | | - | | - |
| Comprehensive income (loss) | | | | | | | | | | | | | | |
| Loss for year | - | | - | - | | - | | - | | - | | (132,766) | | (132,766) |
| Balance, August 31, 2010
| - | $ | - | 191,456,538 | $ | 19,146 | $ | 93,865 | $ | - | $ | (262,069) | $ | (149,058) |
| Comprehensive income (loss) |
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| Loss for period | - |
| - | - | | - |
| - |
| - |
| (31,920) |
| (31,920) |
| Balance, November 30, 2010 | - | $ | - | 191,456,538 | $ | 19,146 | $ | 93,865 | $ | - | $ | (293,989) | $ | (180,978) |
The accompanying notes are an integral part of these financial statements.
F-2
| (formerly Branded Beverages, Inc.) |
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| (A development stage company) |
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| Statements of Operations and Comprehensive Loss | ||||||
| (Expressed in U.S. Dollars) |
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| Three Months |
| Three Months |
| August 30, 2007 |
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| Ended |
| Ended |
| (inception) to |
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| November 30, 2010 |
| November 30, 2009 |
| November 30, 2010 |
| General and administrative expenses | | | | | ||
| Accounting and audit
| $ | 9,371 | $ | 7,324 | $ | 62,043 |
| Amortization | | 353 | | 1,680 | | 20,157 |
| Interest expenses | | - | | - | | 905 |
| Marketing expenses | | - | | 143 | | 10,713 |
| Legal fees | | 1,125 | | 4,050 | | 42,712 |
| Regulatory and filing fees | | 1,168 | | 4,385 | | 15,132 |
| Salaries and benefits | | 19,500 | | 19,500 | | 156,500 |
| Office expenses | | 403 | | 452 | | 15,014 |
|
| | | | | | |
| Loss before extraordinary gain | | 31,920 | | 37,534 | | 323,176 |
| | | | | | | |
| Extraordinary gain | | - | | - | | 29,187 |
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| Net loss and comprehensive loss for the period
| $ | (31,920) | $ | (37,534) | $ | (293,989) |
| | | | | | | |
| Basic and diluted loss per share | $ | (0.00) | $ | (0.00) | | |
| Weighted average number of | | | | | | |
| common shares outstanding | | | | | | |
| - basic and diluted |
| 191,456,538 |
| 177,844,674 |
| |
The accompanying notes are an integral part of these financial statements.
F-3
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| (formerly Branded Beverages, Inc.) |
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| (A development stage company) |
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| Statements of Cash Flows |
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| (Expressed in U.S. Dollars) |
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| Three Months |
| Three Months |
| August 30, 2007 |
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| Ended |
| Ended |
| (inception) to |
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| November 30, 2010 |
| November 30, 2009 |
| November 30, 2010 |
| Cash flows from (used in) operating activities | | | | | | |
| Loss for the period
| $ | (31,920) | $ | (37,534) | $ | (293,989) |
| Adjustments to reconcile net loss to net cash | | | | | | |
| used in operating activities: | | | | | | |
| - Amortization | | 353 | | 1,680 | | 20,157 |
| - Extraordinary gain | | - | | - | | (29,187) |
| - Interest on promissory notes | | - | | - | | - |
| - Deferred salary | | 19,500 | | 19,500 | | 97,500 |
| Changes in non-cash working capital items: | | | | | | |
| - other receivable | | - | | 13,880 | | 37,192 |
| - prepaid expense and deposit | | - | | 1,706 | | - |
| - accounts payable and accrued liabilities
|
| 10,313 |
| (2,968) |
| 11,965 |
|
| | | | | | |
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| (1,754) |
| (3,736) |
| (156,362) |
| Cash flows (used in) investing activities | | | | | | |
| Website development costs | | - | | - | | (20,157) |
| | | | | | | |
| | | | | | | |
| Cash flows from (used in) financing activities | | | | | | |
| Common shares | | - | | - | | 101,698 |
| Due to directors
|
| - |
| 3,435 |
| 90,391 |
| | | | | | | |
| | | - | | 3,435 | | 192,089 |
| | | | | | | |
| Increase in cash and cash equivalents | | (1,754) | | (301) | | 15,570 |
| | | | | | | |
| Cash and cash equivalents, beginning of period
|
| 17,324 |
| 316 |
| - |
| Cash and cash equivalents, end of period
| $ | 15,570 | $ | 15 | $ | 15,570 |
| Supplemental disclosures of cash flow information: | | | | | ||
| Interest expenses paid in cash | $ | - | $ | - | $ | 402 |
| Income taxes paid in cash | $ | - | $ | - | $ | - |
The accompanying notes are an integral part of these financial statements.
F-4
1. INCORPORATION AND CONTINUANCE OF OPERATIONS
Raptor Technology Group, Inc. (the “Company”) was formed on August 30, 2007 under the laws of the State of Nevada under the name of Giddy-up Productions, Inc. with planned principal operations in producing motion pictures.
The Company entered into and completed the Agreement and Plan of Merger with Branded Beverages, Inc., and instituted a forward-split of its Common Stock on the basis of twenty-one new Shares of Common Stock for each one Share of Common Stock issued and outstanding on December 15, 2010. As a result of this Merger, the name of the Company was changed to Branded Beverages, Inc. On December 20, 2010, the Company entered into a Rescission of the Agreement and Plan of Merger due to the inability to obtain required financial statements in a timely manner.
In connection with and prior to the above forward-split of the Company’s Common Stock, the principal shareholder of the Company returned and cancelled 6,100,000 shares of the Company. Upon the forward-split of the Company’s Common Stock and on December 15, 2010, the Company had 63,356,538 common shares issued and outstanding. These financial statements have been retroactively restated to reflect the above noted forward-split.
On January 6, 2011, the Company changed its name to Raptor Technology Group, Inc. and entered into a definitive Plan of Merger and Reorganization with Raptor Fabrication and Equipment, Inc. In accordance with the terms of the Agreement, Raptor Technology Group, Inc. shall be the name of the surviving corporation. The Company's common stock will continue to be quoted on the Over the Counter Bulletin Board (OTCBB) under the new trading symbol RAPT.
Upon the completion of this Merger, which is expected within sixty days, the Company will become a technology supplier that provides eco-friendly and green global issues.
We have not generated any operating revenues to date. We are considered a development stage company as defined in ASC 915. We have an office in Calgary, Alberta. The Company’s fiscal year end is August 31.
These financial statements have been prepared in accordance with U.S. generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. We have incurred operating losses and require additional funds to maintain our operations. Management’s plans in this regard are to raise equity financing as required.
These conditions raise substantial doubt about our ability to continue as a going concern. These financial statements do not include any adjustments that might result from this uncertainty.
2. SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents
Cash equivalents comprise certain highly liquid instruments with a maturity of three months or less when purchased. As at November 30, 2010, cash and cash equivalents consists of only cash.
Accounting Estimates
The preparation of financial statements in conformity with generally accepted accounting principles 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 and assumptions.
Advertising Expenses
We expense advertising costs as incurred. Total advertising expenses for the period ended November 30, 2010 were $nil (November 30, 2009 - $143).
Loss Per Share
Loss per share is computed using the weighted average number of shares outstanding during the period. We have adopted ASC 260, Earnings Per Share. Diluted loss per share is equivalent to basic loss per share as there was no potential dilutive equity instruments.
F-5
The Company adopted ASC 260-10-45-61A which addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting and affects entities that accrue cash dividends on share-based payment awards during the awards’ service period when the dividends do not need to be returned if the employees forfeit the awards. ASC 260-10-45-61A states that all outstanding unvested share-based payment awards that contain rights to nonforfeitable dividends participate in undistributed earnings with common shareholders and, therefore, need to be included in the earnings allocation in computing earnings per share under the two-class method. The adoption of ASC 260-10-45-61A did not have a material impact on the Company’s financial statements.
Concentration of Credit Risk
We place our cash and cash equivalents with high credit quality financial institutions. As of November 30, 2010, we had $ 15,570 (August 31, 2010 - $17,324) in a bank and $nil beyond insured limits.
Foreign Currency Transactions
We are located and operating outside of the United States of America. We maintain our accounting records in U.S. Dollars, as follows:
At the transaction date, each asset, liability, revenue and expense is translated into U.S. dollars by the use of the exchange rate in effect at that date. At the period end, monetary assets and liabilities are re-measured by using the exchange rate in effect at that date. The resulting foreign exchange gains and losses are included in operations.
Fair Value of Financial Instruments
The estimated fair values for financial instruments under ASC 825, Financial Instruments, are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of the Company’s financial instruments includes cash and cash equivalents, other receivable, accounts payable and accrued liabilities and due to related parties. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. The fair value of these financial instruments approximates their carrying values, unless otherwise noted.
The Company adopted ASC 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. The fair value hierarchy distinguishes between assumptions based on market data (observable inputs) and an entity’s own assumptions (unobservable inputs). The hierarchy consists of three levels:
The adoption of ASC 820 has no material effect on the Company’s financial position or results of operations. The book values of cash and cash equivalents, other receivable, accounts payable and accrued liabilities and due to related parties approximate their respective fair values due to the short-term nature of these instruments. The Company has no assets or liabilities that are measured at fair value on a recurring basis. There were no assets or liabilities measured at fair value on a non-recurring basis during the period ended November 30, 2010.
F-6
Income Taxes
We have adopted Statement ASC 740, Income Taxes, which requires us to recognize deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized in our financial statements or tax returns using the liability method. Under this method, deferred tax liabilities and assets are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.
Stock-Based Compensation
The Company adopted ASC 718, Compensation – Stock-Based Compensation, to account for its stock options and similar equity instruments issued. Accordingly, compensation costs attributable to stock options or similar equity instruments granted are measured at the fair value at the grant date, and expensed over the expected vesting period. ASC 718 requires excess tax benefits be reported as a financing cash inflow rather than as a reduction of taxes paid.
We did not grant any stock options during the quarter ended November 30, 2010.
Comprehensive Income
We adopted ASC 220, Comprehensive Income, which establishes standards for reporting and display of comprehensive income, its components and accumulated balances. We are disclosing this information on our Statement of Stockholders' Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. We have no elements of "other comprehensive income” for the quarter ended November 30, 2010.
Film Property and Screenplay Rights
The Company capitalized costs it incurs to buy film or transcripts that will later be marketed or be used in the production of films according to ASC 926, Entertainment – Films. The Company will begin amortization of capitalized film cost when a film is released and it begins to recognize revenue from the film.
Accounting for Derivative Instruments and Hedging Activities
We have adopted ASC 815, Derivatives and Hedging, which requires companies to recognize all derivative contracts as either assets or liabilities in the balance sheet and to measure them at fair value. If certain conditions are met, a derivative may be specifically designated as a hedge, the objective of which is to match the timing of gain and loss recognition on the hedging derivative with the recognition of (i) the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk or (ii) the earnings effect of the hedged forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in income in the period of change.
We have not entered into derivative contracts either to hedge existing risks or for speculative purposes since inception.
Long-Lived Assets Impairment
Our long-term assets are reviewed when changes in circumstances require as to whether their carrying value has become impaired, pursuant to guidance established in ASC 360, Property, Plant and Equipment. Management considers assets to be impaired if the carrying value exceeds the future projected cash flows from the related operations (undiscounted and without interest charges). If impairment is deemed to exist, the assets will be written down to fair value.
Website Development Costs
Website development costs are for the development of the Company's Internet website. These costs have been capitalized when acquired and installed, and are being amortized over its estimated useful life of three years on a straight line basis. The Company accounts for these costs in accordance with ASC 350, Intangibles, which specifies the appropriate accounting for costs incurred in connection with the development and maintenance of websites. Amortization expense is total of $353 for the quarter ended November 30, 2010 (November 30, 2009 - $1,680).
F-7
Newly Adopted Accounting Pronouncements
In April, 2009, the FASB issued ASC subtopic 820-10 (formerly Staff Position No. FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly). ASC 820-10 provides additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased. This ASC subtopic also includes guidance on identifying circumstances that indicate a transaction is not orderly. The Company adopted ASC subtopic 820-10 on September 1, 2010. The adoption of ASC 820-10 did not have a material impact on the Company’s financial statements.
In April, 2009, the FASB issued ASC 820-10-50 (formerly Staff Position No. FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments) that expands to interim periods the existing annual requirement to disclose the fair value of financial instruments that are not reflected on the balance sheet at fair value. The Company adopted ASC 820-10-50 on September 1, 2010. The adoption of this FSP did not have a material impact on the Company’s financial statements.
In June 2009, the FASB issued ASC 860, Transfers and Servicing. ASC 860 requires more information about transfers of financial assets, including securitization transactions, and where entities have continuing exposure to the risks related to transferred financial assets. It eliminates the concept of a “qualifying special-purpose entity,” changes the requirements for derecognizing financial assets, and requires additional disclosures. It also enhances information reported to users of financial statements by providing greater transparency about transfers of financial assets and an entity’s continuing involvement in transferred financial assets. The Company adopted ASC 860 on September 1, 2010. The adoption of ASC 860 did not have a material impact on the Company’s financial statements.
Recent Accounting Pronouncements
In January 2010, the FASB issued a new guidance, Improving Disclosures about Fair Value Measurements (ASU 2010-06). This provision amends previous provisions that require reporting entities to make new disclosures about recurring and nonrecurring fair value measurements including the amounts of and reasons for significant transfers into and out of Level 1 and Level 2 fair value measurements and separate disclosure of purchases, sales, issuances, and settlements in the reconciliation of Level 3 fair value measurements. This guidance is effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2009, except for Level 3 reconciliation disclosures which are effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2010. The adoption of this guidance did not have a material impact on the Company’s results of operations or financial condition.
In July 2010, the FASB issued Accounting Standards Update ASU 2010-20, Receivables (Topic 310) Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses, which improves the disclosures that an entity provides about the credit quality of its financing receivables and the related allowance for credit losses. As a result of these amendments, an entity is required to disaggregate by portfolio segment or class certain existing disclosures and provide certain new disclosures about its financing receivables and related allowance for credit losses. ASU 2010-20 is effective for financial statements issued for interim and annual periods ending on or after December 15, 2010 except for disclosures about activity that occurs during a reporting period, which are effective for interim and annual reporting periods beginning on or after December 15, 2010. The Company does not expect the adoption of ASU 2010-20 to have a material impact on its consolidated financial statements.
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption.
3. PREFERRED AND COMMON STOCK
We have 100,000,000 shares of preferred stock authorized at par value of $0.0001 per share and none issued.
We have 100,000,000 shares of common stock authorized at par value of $0.0001 per share. All shares of stock are non-assessable and non-cumulative, with no pre-emptive rights.
On December 15, 2010, prior to forward-split of the Company’s common stocks, the Company’s principal shareholder returned and cancelled 6,100,000 common shares with a total of 3,016,978 common shares issued and outstanding. Subsequent to the return and cancellation of 6,100,000 common shares of the Company, the Company effected a forward-split of its common stock on the basis of twenty-one new Shares of Common Stock for each one Share of Common Stock issued and outstanding on December 15, 2010 which resulting a total 63,356,538 common shares issued and outstanding upon the forward split.
F-8
These financial statements have been retroactively restated to reflect the above forward-split. Therefore, despite the total authorized common stocks of the Company is 100,000,000, the Company had 191,456,538 shares issued and outstanding as of November 30, 2010 and August 31, 2010, which did not taken into account the related shares of 128,100,000 (post forward-split) returned and cancelled by the principal shareholder of the Company on December 15, 2010.
4. RELATED PARTY TRANSACTIONS
During the quarter ended November 30, 2010, the Company incurred $19,500 (2009 - $19,500) of salaries expense to a director of the Company. As at November 30, 2010, $97,500 has been deferred and included in due to related parties.
As at November 30, 2010, $185,085 was due to related parties, which $168,397 (2009 - $67,837) was due to the sole director of the Company and $16,687 (2009 - $nil) was due to a former director and a shareholder. The amount due to related parties was unsecured, non-interest bearing and due on demand.
5. COMMITMENTS
On January 1, 2009, the Company signed employment agreement with the director of the Company for a total of US $6,500 per month. The agreement shall continue until terminated by the director upon giving 3 months’ notice to the Company, or by the Company without notice.
6. COMPARATIVE FIGURES
Certain comparative figures have been reclassified in order to conform to the current period’s financial statement presentation.
7. SUBSEQUENT EVENTS
On December 15, 2010, the Company entered into and completed the Agreement and Plan of Merger with Branded Beverages, Inc., and instituted a forward-split of its Common Stock on the basis of twenty-one new Shares of Common Stock for each one Share of Common Stock issued and outstanding on December 15, 2010. As a result of this Merger, the name of the Company was changed to Branded Beverages, Inc. On December 20, 2010, the Company entered into a Rescission of the Agreement and Plan of Merger due to the inability to obtain required financial statements in a timely manner.
On January 6, 2011, the Company changed its name to Raptor Technology Group Inc. and entered into a definitive plant of merger and reorganization with Raptor Fabrication and Equipment Inc. Per agreement, Raptor Technology Group Inc. shall be the name of the surviving corporation.
F-9
Item 2. Management’s Discussion and Analysis of Financial Condition and Result of Operations.
THE FOLLOWING DISCUSSION OF THE RESULTS OF OUR OPERATIONS AND FINANCIAL CONDITION SHOULD BE READ IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND THE NOTES THERETO INCLUDED ELSEWHERE IN THIS REPORT.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of our report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results and predictions. We are a development stage company and have not yet generated or realized any revenues.
Overview
We were incorporated as a Nevada company on August 30, 2007. On December 15, 2010, we entered into and completed the Agreement and Plan of Merger with Branded Beverages, Inc., and instituted a forward-split of our Common Stock on the basis of twenty-one new Shares of Common Stock for each one Share of Common Stock issued and outstanding on December 15, 2010. As a result of this Merger, we changed our name to Branded Beverages, Inc. On December 20, 2010, we entered into a Rescission of the Agreement and Plan of Merger due to the inability to obtain required financial statements in a timely manner.
On December 15, 2010 and prior to the twenty-one to one forward-split, our principal shareholder of the Company returned and cancelled 6,100,000 shares of the Company. Upon the forward-split of the Company’s Common Stock and on December 15, 2010, we had 63,356,538 common shares issued and outstanding.
On January 6, 2011, we changed our name to Raptor Technology Group, Inc. and entered into a definitive Plan of Merger and Reorganization with Raptor Fabrication and Equipment, Inc. In accordance with the terms of the Agreement, Raptor Technology Group, Inc. shall be the name of the surviving corporation. Our common stock will continue to be quoted on the Over the Counter Bulletin Board (OTCBB) under the new trading symbol RAPT.
Upon the completion of this Merger, which is expected within sixty days, we will become a technology supplier that provides eco-friendly and green global issues.
We have not generated any operating revenues to date. We are considered a development stage company as defined in ASC 915 and having our principal office located at 409-903 19th Avenue SW, Calgary, AB. Our telephone number is 403-399-6402. Our facsimile number is 866-900-0582. We currently do not have any subsidiaries.
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We are a “shell company” as defined in Rule 405 under the Securities Act of 1933 and Rule 12b-2 under the Securities Exchange Act of 1934, since we have only conducted nominal operations and have nominal assets.
Our Operations
Prior to our attempted merger of Branded Beverages, Inc. on December 15, 2010, we were in the business of developing, producing, marketing and distributing low-budget feature-length films. Further, on January 6, 2011, we changed our name to Raptor Technology Group, Inc. and entered into a definitive Plan of Merger and Reorganization with Raptor Fabrication and Equipment, Inc. In accordance with the terms of the Agreement, Raptor Technology Group, Inc. shall be the name of the surviving corporation. Our common stock will continue to be quoted on the Over the Counter Bulletin Board (OTCBB) under the new trading symbol RAPT.
Raptor Fabrication and Equipment is a technology supplier that provides eco-friendly and green solutions to global issues. It committed to developing reliable fuel and energy alternatives by making them both dependable and economically appealing to the manufacturer as well as the consumer. Additional patent pending technology has also been developed to recover rare earth minerals from endless miles of mine tailings. This technology provides an eco-friendly means of recycling these mine tailings both economically and profitably.
Upon the completion of this Merger, which is expected within sixty days, we have positioned ourselves to become a leader in the biofuel and mining industries with the advanced proprietary biofuel production technology and mineral recovery technologies. Management's plan for eco-friendly business solutions and economically profitable business models are designed to secure the Company as a leader in the alternative energy and remediation sectors.
No assurance can be given that our planned business, if the merger completed, will be successful or make a profit.
The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this quarterly report. The discussions of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future.
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Results of Operations for the Three Months ended November 30, 2010, compared to the same period in 2009
The following discussion should be read in conjunction with the financial statements included in this report and is qualified in its entirety by the foregoing.
Liquidity and Capital Resources
As of November 30, 2010 we had cash of $15,570, total current assets of $15,570, total current liabilities of $196,548 and a working capital deficiency of $180,978. From our inception on August 30, 2007 to November 30, 2010 we accumulated a deficit of $293,989. We are dependent on funds raised through equity or debt financing and investing activities to fund our operations. We anticipate that we will incur substantial losses over the next year and our ability to generate any revenues in the next 12 months continues to be uncertain.
As of November 30, 2010 we had total assets of $15,570 and total liabilities of $196,548. Our total assets were primarily made up of cash.
We used net cash of $1,754 in operating activities for the quarter ended November 30, 2010, compared to $3,736 during the same period in 2009 and $156,362 from our inception on August 30, 2007 to November 30, 2010.
We used net cash of $Nil in investing activities for the quarter ended November 30, 2010, compared to $Nil during the same period in 2009, and $20,157 from our inception on August 30, 2007 to November 30, 2010. The cash used in investing activities since our inception was for website development costs.
We received net cash of $Nil from financing activities for the quarter ended November 30, 2010, compared to $3,435 during the same period in 2009 and $192,089 from our inception on August 30, 2007 to November 30, 2010. The cash received from financing activities during the period ended November 30, 2009 resulted from advances from our director. During the period ended November 30, 2010, our cash position decreased by $1,754.
Results of Operations
Revenues
From our inception on August 30, 2007 to November 30, 2010 we have not yet generated any revenues. We do not expect to earn revenues in the near future.
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Expenses
We incurred total operating expenses of $31,920 for the quarter ended November 30, 2010, compared to $37,534 for the same period in 2009 and $323,176 from our inception on August 30, 2007 to November 30, 2010. The decrease in operating expenses for the period ended November 30, 2010 resulted from a decrease in general and administrative costs.
We incurred accounting and audit fees of $9,371, $353 in amortization costs, $Nil in marketing expenses, $1,125 in legal fees, $1,168 in filing fees, $19,500 in salaries and benefits and $403 in office expenses for the quarter ended November 30, 2010. For the same period in 2009, we incurred accounting and audit fees of $7,324, $1,680 in amortization costs, $143 in marketing expenses, $4,050 in legal fees, $4,385 in filing fees, $19,500 in salaries and benefits and $452 in office expenses. From our inception on August 30, 2007 to November 30, 2010 we incurred $62,043 in accounting and audit expenses, $20,157 in amortization, $905 in interest expenses, $10,713 in marketing expenses, $42,712 in legal fees, $15,132 in filing fees, $156,500 in salaries and benefits and $15,014 in office expenses.
Net Loss
From our inception on August 30, 2007 to November 30, 2010 we incurred net a loss of $293,989, after an extraordinary gain of $29,187. For the quarter ended November 30, 2010 we incurred a net loss of $31,920, compared to a net loss of $37,534 for the same period in 2009.
Research and Development
For the quarter ended November 30, 2010 and from our inception, we have not incurred any research and development expenses.
Off-Balance Sheet Arrangements
As of November 30, 2010 we had no off balance sheet transactions that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable to smaller reporting companies.
Item 4. Controls and Procedures.
Not applicable to smaller reporting companies.
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Item 4T. Controls and Procedures.
We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. 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 of November 30, 2010. Based on the evaluation of these disclosure controls and procedures, and the material weaknesses in our internal control over financial reporting identified in our Annual Report on Form 10-K for the period ended August 30, 2010, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective.
Changes in Internal Control
We have not been able to implement any of the recommended changes to our internal control over financial reporting listed in our Annual Report on Form 10-K for the year ended August 30, 2010. As such, there were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act, during the quarter ended November 30, 2010, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management is not aware of any legal proceedings contemplated by any governmental authority against us. None of our directors, officers or affiliates (i) are a party adverse to us in any legal proceedings, or (ii) have an adverse interest to us in any legal proceedings.
Not applicable to smaller reporting companies.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
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Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submissions of Matters to a Vote of Security Holders.
None.
None.
EXHIBIT DESCRIPTION
SIGNATURES
Pursuant to the requirements of the Securitas Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| RAPTOR TECHNOLOGY GROUP, INC. | ||
| Date: January 14, 2011 |
| By: /s/ Zoltan Nagy |
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| Zoltan Nagy |
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| President, Chief Executive Officer, Chief Financial Officer, Director, Secretary, Treasurer |
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