Delaware
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20-4378866
|
|
(State
or Other Jurisdiction of Incorporation
or
Organization)
|
(I.R.S.
Employer
Identification
No.)
|
|
1177
High Ridge Road, Stamford, CT
|
06905
|
|
(Address
of Principal Executive Offices)
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(Zip
Code)
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(203)
321-1285
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||
(Issuer’s
Telephone Number, Including Area
Code)
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PAGE
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||||
PART
I
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FINANCIAL
INFORMATION
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3
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||
ITEM
1
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Financial
Statements
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3
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||
ITEM
2
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Management’s
Discussion and Analysis and Results of Operations
|
4
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||
ITEM
3
|
Controls
and Procedures
|
11
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||
PART
II
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OTHER
INFORMATION
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12
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||
ITEM
1
|
Legal
Proceedings
|
12
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||
ITEM
2
|
Unregistered
Sales of Equity Securities and Use of Proceeds.
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12
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||
ITEM
3
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Defaults
Upon Senior Securities
|
12
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||
ITEM
4
|
Submission
of Matters to a Vote of Security Holders.
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12
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ITEM
5
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Other
Information
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12
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||
ITEM
6
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Exhibits
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13
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||
SIGNATURES
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15
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|||
CERTIFICATIONS
|
Balance
Sheet as of September 30, 2007
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F-1
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|||
Statements
of Operations for the 3 months ended September 30, 2007 and
2006
|
F-2
|
|||
Statements
of Cash Flows for the 3 months ended September 30, 2007 and
2006
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F-3
|
|||
Notes
to Financial Statements
|
F-5
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ASSETS
|
||||
Current
Assets:
|
||||
Cash
and Cash Equivalents
|
$
|
3,752
|
||
Total
Current Assets
|
3,752
|
|||
Property
and Equipment, Net
|
1,669
|
|||
Deferred
Finance Costs, Net
|
41,111
|
|||
Total
Assets
|
$
|
46,532
|
||
LIABILITIES
AND STOCKHOLDERS’ DEFICIENCY
|
||||
Current
Liabilities:
|
||||
Convertible
Debentures
|
$
|
500,000
|
||
Notes
Payable
|
201,960
|
|||
Accrued
Expenses
|
73,793
|
|||
Accrued
Liquidated Damages
|
106,667
|
|||
Accrued
Interest
|
80,089
|
|||
Total
Current Liabilities
|
962,509
|
|||
Commitments
and Contingencies
|
||||
Stockholders’
Deficiency:
|
||||
Preferred
Stock, $.0001 par value; 10,000,000 shares authorized,
|
||||
none
issued and outstanding
|
-
|
|||
Common
Stock, $.0001 par value; 250,000,000 shares authorized,
|
||||
16,761,597
issued and outstanding
|
1,676
|
|||
Additional
Paid-In Capital
|
288,822
|
|||
Deficit
Accumulated During the Development Stage
|
(1,206,475
|
)
|
||
Total
Stockholders’ Deficiency
|
(915,977
|
)
|
||
Total
Liabilities and Stockholders’ Deficiency
|
$
|
46,532
|
For
the Three
Months
Ended
September
30, 2007
|
For
the Three
Months
Ended
September
30, 2006
|
For
the Period
December
15, 2005
(Inception)
to
September
30, 2007
|
||||||||
Net
Revenues
|
$
|
-
|
$
|
-
|
$
|
-
|
||||
Costs
and Expenses:
|
||||||||||
Officer’s
Compensation
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45,000
|
45,000
|
285,000
|
|||||||
Software
Development
|
42,000
|
40,000
|
256,985
|
|||||||
Other
General and Administrative Expenses
|
32,653
|
18,653
|
218,486
|
|||||||
Total
Costs and Expenses
|
119,653
|
103,653
|
760,471
|
|||||||
Loss
from Operations
|
(119,653
|
)
|
(103,653
|
)
|
(760,471
|
)
|
||||
Other
Expenses:
|
||||||||||
Amortization
of Deferred Finance Costs
|
(58,726
|
)
|
(23,125
|
)
|
(199,002
|
)
|
||||
Amortization
of Deferred Debt Discount
|
(37,654
|
)
|
-
|
(60,246
|
)
|
|||||
Interest
Expense
|
(17,352
|
)
|
(9,950
|
)
|
(80,089
|
)
|
||||
Liquidated
Damages
|
-
|
(30,000
|
)
|
(106,667
|
)
|
|||||
Total
Other Expenses
|
(113,732
|
)
|
(63,075
|
)
|
(446,004
|
)
|
||||
Net
Loss
|
$
|
(233,385
|
)
|
$
|
(166,728
|
)
|
$
|
(1,206,475
|
)
|
|
Weighted
Average Common Shares
|
||||||||||
Outstanding
- Basic and Diluted
|
16,761,597
|
16,293,333
|
||||||||
Net
Loss Per Common Share
|
$
|
(.01
|
)
|
$
|
(.01
|
)
|
For
the Three
Months
Ended
September
30, 2007
|
For
the Three
Months
Ended
September
30, 2006
|
For
the Period
December
15, 2005
(Inception)
to
September
30, 2007
|
||||||||
Cash
Flows from Operating Activities:
|
||||||||||
Net
Loss
|
$
|
(233,385
|
)
|
$
|
(166,728
|
)
|
$
|
(1,206,475
|
)
|
|
Adjustments
to Reconcile Net Loss to
Net
Cash (Used) in Operating Activities:
|
||||||||||
Amortization
of Debt Discount
|
37,654
|
-
|
60,246
|
|||||||
Amortization
of Deferred Finance Costs
|
58,726
|
23,125
|
199,002
|
|||||||
Depreciation
Expense
|
239
|
239
|
1,193
|
|||||||
Common
Stock Issued for Software Development
|
-
|
-
|
970
|
|||||||
Changes
in Assets and Liabilities:
|
||||||||||
Increase
in Accrued Expenses
|
62,542
|
13,991
|
208,794
|
|||||||
Increase
in Accrued Interest
|
17,352
|
9,950
|
80,089
|
|||||||
Increase
in Accrued Liquidated Damages
|
-
|
30,000
|
106,667
|
|||||||
Net
Cash (Used) in Operating Activities
|
(56,872
|
)
|
(89,423
|
)
|
(549,514
|
)
|
||||
Cash
Flows from Investing Activities:
|
||||||||||
Purchase
of Equipment
|
-
|
(2,862
|
)
|
(2,862
|
)
|
|||||
Net
Cash Used in Investing Activities
|
-
|
(2,862
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)
|
(2,862
|
)
|
|||||
Cash
flows from Financing Activities:
|
||||||||||
Decrease
in Stock Subscription Receivable
|
-
|
354
|
451
|
|||||||
Proceeds
from Issuance of Convertible Debentures
|
-
|
-
|
500,000
|
|||||||
Proceeds
from Issuance of Notes Payable
|
-
|
-
|
170,000
|
|||||||
Payments
of Finance Costs
|
-
|
-
|
(215,513
|
)
|
||||||
Proceeds
from Issuance of Common Stock
|
-
|
-
|
106,190
|
|||||||
Expense
on Sale of Common Stock
|
-
|
-
|
(5,000
|
)
|
||||||
Net
Cash Provided by Financial Activities
|
-
|
354
|
556,128
|
|||||||
Increase
(Decrease) in Cash
|
(56,872
|
)
|
(91,931
|
)
|
3,752
|
|||||
Cash
- Beginning of Period
|
60,624
|
224,279
|
-
|
|||||||
Cash
- End of Period
|
$
|
3,752
|
$
|
132,348
|
$
|
3,752
|
For
the Three
Months
Ended
September
30, 2007
|
For
the Three
Months
Ended
September
30, 2006
|
For
the Period
December
15, 2005
(Inception)
to
September
30, 2007
|
||||||||
Supplemental
Cash Flow Informaiton:
|
||||||||||
Cash
Paid for Interest
|
$
|
-
|
$
|
-
|
$
|
-
|
||||
Cash
Paid for Income Taxes
|
$
|
-
|
$
|
-
|
$
|
250
|
||||
Supplemental
Non-Cash Financing Activities:
|
||||||||||
Subscription
Receivable on Sale of
Common
Stock
|
$
|
-
|
$
|
451
|
$
|
451
|
||||
Common
Stock Warrants Issued as
Deferred
Finance Costs
|
$
|
-
|
$
|
-
|
$
|
9,641
|
||||
Debt
Discount Attributable to Common
Stock
Warrants on Notes Payable
|
$
|
-
|
$
|
-
|
$
|
43,246
|
||||
Note
Payable Issued as Payment of
Deferred
Finance Costs
|
$
|
-
|
$
|
-
|
$
|
14,960
|
||||
Exchange
of Related Party Debt to
Contributed
Capital
|
$
|
135,000
|
$
|
-
|
$
|
135,000
|
· |
With
a price of less than $5.00 per
share;
|
· |
That
are not traded on a “recognized” national
exchange;
|
· |
Whose
prices are not quoted on a NASDAQ automated quotation system
(NASDAQ-listed stock must still have a price of not less than $5.00
per
share); or
|
· |
Stock
in issuers with net tangible assets less than $2,000,000 (if the
issuer
has been in continuous operation for at least three years) or $5,000,000
(if in continuous operation for less than three years), or with average
revenues of less than $6,000,000 for the last three
years.
|
a. |
Exhibits
pursuant to Regulation S-K:
|
DESIGNATION
OF EXHIBIT AS SET FORTH IN ITEM 601 OF REGULATION S-B
|
DESCRIPTION
|
LOCATION
|
||
3.1
|
Articles
of Incorporation
|
Incorporated
by Reference to the Registration Statement on Form SB-2 filed on
November
13, 2006 (File No. 333-138625).
|
||
3.2
|
Bylaws
|
Incorporated
by Reference to the Registration Statement on Form SB-2 filed on
November
13, 2006 (File No. 333-138625).
|
||
4.1
|
Securities
Purchase Agreement dated March 10, 2006 by and between the Company
and
Alpha Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna
Enterprises Corp., and CMS Capital
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.2
|
7%
Convertible Debenture dated March 10, 2006 issued to Alpha Capital
Aktiengesellschaft
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.3
|
Registration
Rights Agreement dated March 10, 2006 by and between the Company
and Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna Enterprises
Corp., and CMS Capital
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.4
|
Security
Agreement dated March 10, 2006 by and between the Company and Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna Enterprises
Corp., and CMS Capital and Michael Hartstein, as collateral
agent
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.5
|
Collateral
Agent Agreement dated March 10, 2006 by and between the Company
and Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna Enterprises
Corp., and CMS Capital and Michael Hartstein, as collateral
agent
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.6
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.7
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.8
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
10.1
|
Asset
Purchase Agreement by and between Isidore Sobkowski and the Company
dated
March 6, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No.
333-138625).
|
DESIGNATION
OF EXHIBIT AS SET FORTH IN ITEM 601 OF REGULATION S-B
|
DESCRIPTION
|
LOCATION
|
||
10.2
|
Voting
Agreement by and between Michael Hartstein, Solomon Lax and Isidore
Sobkowski
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement on
Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
10.3
|
Subscription
Agreement by and among the Company, Alpha Capital Anstalt, and
Harborview
Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.4
|
Form
of Warrant issued by the Company to each of Alpha Capital Anstalt,
and
Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.5
|
Form
of Secured Note issued by the Company to each of Alpha Capital
Anstalt and
Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.6
|
Consent
Agreement by and among the Company, Alpha Capital Anstalt, and
Harborview
Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
31.1
|
Certification
of President and Chief Executive Officer (one person) pursuant
to Rule
13a-14(a)/15d-14(a) of the Exchange Act
|
Provided
Herewith
|
||
32.1
|
Certification
of President and Chief Executive Officer (one person) pursuant
to 18
U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
Provided
Herewith
|
APRECIA,
INC.
|
||
|
|
|
December
12, 2007
|
By: |
/s/
Isidore Sobkowski
|
Isidore
Sobkowski, President, Chief Executive Officer
and
Interim Chief Financial Officer
|