UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
| x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2010
| ¨ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _______________ to _______________
Commission File Number 001-12885
ALPHA-EN CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
| Delaware | 95-4622429 | |
| (State or Other Jurisdiction | (I.R.S. Employer | |
| of Incorporation or Organization) | Identification No.) |
| 120 White Plains Road, Tarrytown, New York | 10591 | ||
| (Address of Principal Executive Offices) | (Zip Code) |
(914) 631-5265
(Registrant’s Telephone Number, Including Area Code)
Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 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 ¨ No ¨ (not required)
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large Accelerated Filer o | Accelerated Filer o |
Non-accelerated Filer o | Smaller Reporting Company x |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
As of November 12, 2010, there were 27,821,030 shares of the issuer’s common stock outstanding.
| Page | ||
| PART I. FINANCIAL INFORMATION | ||
| ITEM 1. | Financial Statements | 1 |
| ITEM 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 9 |
| ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk | 12 |
| ITEM 4. | Controls and Procedures | 13 |
| PART II. OTHER INFORMATION | ||
| ITEM 1. | Legal Proceedings | 14 |
| ITEM 1A. | Risk Factors | 14 |
| ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 14 |
| ITEM 3. | Defaults upon Senior Securities | 14 |
| ITEM 4. | Reserved | 14 |
| ITEM 5. | Other Information | 14 |
| ITEM 6. | Exhibits | 14 |
| SIGNATURES | 15 | |
ITEM 1. Financial Statements
Alpha-En Corporation
Index to Consolidated Financial Statements
| Page | |
| Consolidated Balance Sheet as of September 30, 2010 (unaudited) and December 31, 2009 | 2 |
| Consolidated Statement of Operations for the three and nine months ended September 30, 2010 and 2009 (unaudited) | 3 |
| Consolidated Statement of Cash Flows for the nine months ended September 30, 2010 and 2009 (unaudited) | 4 |
| Notes to Consolidated Financial Statements (unaudited) | 5 |
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ALPHA-EN CORPORATION
CONSOLIDATED BALANCE SHEET
| September 30, 2010 | December 31, 2009 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | 179 | $ | 2,175 | ||||
| Prepaid expenses | 7,819 | 3,069 | ||||||
| Total current assets | 7,998 | 5,244 | ||||||
| Intangible assets | 250,000 | 250,000 | ||||||
| TOTAL ASSETS | $ | 257,998 | $ | 255,244 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 101,112 | $ | 71,482 | ||||
| Loan payable - stockholder/officer | 28,992 | 137,401 | ||||||
| Note payable | 4,978 | 1,607 | ||||||
| Due to related party | 3,630 | 4,713 | ||||||
| TOTAL LIABILITIES | 138,712 | 215,203 | ||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Preferred stock, $.01 par value, 2,000,000 shares authorized; none issued | ||||||||
| Class B common stock, no par value, 1,000,000 shares authorized; none issued | ||||||||
Common stock, $.01 par value, 35,000,000 shares authorized; 27,821,030 and 25,821,030 shares issued and outstanding as of September 30, 2010 and December 31, 2009, respectively | 278,210 | 258,210 | ||||||
| Additional paid-in capital | 7,718,103 | 7,578,103 | ||||||
| Accumulated deficit | (7,807,644 | ) | (7,726,889 | ) | ||||
Treasury stock, at cost (798,918 shares of common stock) | (69,383 | ) | (69,383 | ) | ||||
| TOTAL STOCKHOLDERS' EQUITY | 119,286 | 40,041 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 257,998 | $ | 255,244 | ||||
See notes to consolidated financial statements
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ALPHA-EN CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | ||||||||||||||
| Revenues | $ | 60 | $ | 423 | $ | 1,082 | $ | 2,923 | |||||||||
| General and administrative expenses | (21,822 | ) | (24,540 | ) | (81,837 | ) | (98,852 | ) | |||||||||
| Net loss | $ | (21,762 | ) | $ | (24,117 | ) | $ | (80,755 | ) | $ | (95,929 | ) | |||||
| Net loss per share - basic and diluted | * | $ | * | * | $ | * | |||||||||||
Weighted average common shares outstanding - basic and diluted | 27,821,030 | 25,821,030 | 26,758,759 | 25,205,645 | |||||||||||||
| * | Less than $.01 per share |
See notes to consolidated financial statements
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ALPHA-EN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
| Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2010 | 2009 | |||||||
| Cash Flows From Operations | ||||||||
| Net loss | $ | (80,755 | ) | $ | (95,929 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses | 9,783 | (7,673 | ) | |||||
| Accounts payable and accrued expenses | 29,630 | 13,570 | ||||||
| Net cash used in operating activities | (41,342 | ) | (90,032 | ) | ||||
| Cash Flows From Financing Activities | ||||||||
| Payments of note payable | (11,162 | ) | 6,343 | |||||
| Increase in loan payable - stockholder/officer | 51,591 | 67,213 | ||||||
| Decrease in due to related party | (1,083 | ) | (2,923 | ) | ||||
| Net cash provided by financing activities | 39,346 | 70,633 | ||||||
| Decrease in cash | (1,996 | ) | (19,399 | ) | ||||
| Cash - Beginning of period | 2,175 | 22,172 | ||||||
| Cash - End of period | $ | 179 | $ | 2,773 | ||||
| Noncash Transaction: | ||||||||
Payment of loan payable - stockholder/officer for issuance of common stock | $ | 160,000 | ||||||
| Purchase of intangible assets for issuance of common stock | $ | 250,000 | ||||||
See notes to consolidated financial statements
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Alpha-En Corporation
Notes to Consolidated Financial Statements (Unaudited)
1. Organization and Operations
Alpha-En Corporation (Company) was incorporated in Delaware on March 7, 1997 and had operated through its wholly-owned subsidiaries, Avenue Pictures, Inc. and its subsidiaries and Wombat Productions, Inc., through May 2, 2006.
From May 2, 2006, through February 24, 2009, the Company had been inactive.
On February 25, 2009, the Company was granted a license for an exclusive, worldwide, transferable, perpetual license to use certain proprietary technology for the processing of lithium for use in batteries and other fields.
Commencing in October 2010, working through a third party, we conducted a series of tests to determine if the process works and, based on the results, we believe that the process is workable and commercially feasible. We intend to hire a management team to implement this process in the upcoming months.
2. Summary of Significant Accounting Policies
Basis of presentation
The accompanying unaudited financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and with the rules and regulations under Regulation S-X of the Securities and Exchange Commission for Form 10-Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements presentation. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to present fairly the financial position, results of operations and cash flows for interim financial statements have been included. These financial statements should be read in conjunction with the financial statements of the Company together with the Company's management discussion and analysis in Item 2 of this report and in the Company's Form 10-K for the year ended December 31, 2009. Interim results are not necessarily indicative of the results for a full year.
Consolidated Financial Statements
The Company's consolidated financial statements include all the accounts of the Company and its wholly-owned subsidiaries. All material intercompany accounts and transactions have been eliminated.
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Use of 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 disclosures 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.
Intangible Assets
Intangible assets are recorded at fair value and, as they an indefinite life, will not be amortized. The carrying value of the intangible assets will be evaluated by management for impairment at least annually or upon the occurrence of an event which may indicate that the carrying amount may be greater than its fair value. If impaired, the Company will write down such impairment. In addition, the useful life of the intangible assets will be evaluated by management at least annually or upon the occurrence of an event which may indicate that the useful life may be definitive and the Company will commence amortization over such useful life.
New Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.
3. Going Concern and Management’s Plans
The accompanying consolidated financial statements have been prepared assuming that Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred operating losses, negative working capital and no operating cash flow and future losses are anticipated.
The Company’s plan of operations, to raise equity financing, even if successful, may not result in cash flow sufficient to finance and expand its business and generate sales from the License (see Note 4). These factors raise substantial doubt about the Company’s ability to continue as a going concern. Realization of assets is dependent upon future operations of the Company, which in turn is dependent upon management’s plans to meet its financing requirements and the success of its future operations. These financial statements do not include any adjustments related to the recoverability and classification of asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue existence.
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4. Intangible Assets
On February 25, 2009, the Company was granted an exclusive, worldwide, transferable, perpetual license (License) to use certain proprietary technology for the processing of lithium for use in batteries and other fields. A patent application relating to the licensed technology is pending.
In exchange for the License, the Company:
(1) issued 1,000,000 shares of common stock of the Company;
(2) issued an additional 2,000,000 shares of common stock of the Company, which are restricted and subject to forfeiture if there has not been at least $1,000,000 in total commercial sales of licensed products within three years (Threshold);
(3) will pay royalties of $1.00, per kilogram, of lithium products manufactured and sold, payable quarterly;
(4) will pay royalties of $.10, per kilogram, of excess products manufactured and sold, payable quarterly;
(5) will grant options to purchase up to a total of 19% (inclusive of previously issued shares) of the issued and outstanding shares of the Company upon the issuance of any additional shares after the date of the License. These options are exercisable at the same prices as the shares sold or values received for five years from each grant date. These grants are only issuable if the Threshold is met.
Upon a transfer of the entire License, the Company shall pay the licensor a fee equal to 19% of all compensation received on the transfer.
The License has been recorded at its fair value of $250,000 based on the management’s projected net cash flows to be realized from sales of products under the License.
5. Notes Payable
On March 10, 2010, in connection with the purchase of directors and officers liability insurance, the Company borrowed $14,532, payable in nine equal monthly installments of $1,690 through December 2010, including interest of 11.04%, per annum.
6. Related Party Transactions
As of September 30, 2010, loan payable – stockholder/officer of $ 28,992 is payable on demand, with interest at 5%, per annum.
On May 25, 2010 the Company issued 2,000,000 share of its common stock in payment of $160,000 of the loan payable-stockholder/officer.
In October 2010, the Company borrowed an additional $4,500 from the stockholder/officer.
An officer of the Company provides administrative space without rent.
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7. Income Taxes
As of September 30, 2010, management has evaluated and concluded that there are no significant uncertain tax positions required recognition in the Company’s consolidated financial statements.
8. Adoption of Accounting Policies
During the nine months ended September 30, 2010, the Company adopted the following accounting policies, without a material impact on the consolidated financial statements:
In February 2010, the FASB issued ASU No. 2010-09, which is included in the Codification under ASC 855, “Subsequent Events” (ASC 85). This update removes the requirement for an SEC filer to disclose the date through which subsequent events have been evaluated.
In January 2010, the FASB issued ASU No. 2010-06, which is included in the Codification under ASC 820, “Fair Value Measurements and Disclosures” (ASC 820). This update requires the disclosure of transfers between the observable input categories and activity in the unobservable input category for fair value measurements. The guidance also requires disclosures about the inputs and valuation techniques used to measure fair value.
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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Management’s Discussion and Analysis of Financial Condition and Results of Operations section and other parts of this report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve risks and uncertainties. These statements relate to our future plans, objectives, expectations and intentions. These statements may be identified by the use of words such as “may”, “could”, “would”, “should”, “will”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, and similar expressions. Our actual results and the timing of certain events may differ significantly from the results and timing described in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those factors discussed or referred to in the annual report on Form 10-K for the year ended December 31, 2009 and in subsequent period reports filed with the U.S. Securities and Exchange Commission, including this report. The following discussion and analysis of our financial condition and results of operations should be read in light of those factors and in conjunction with our accompanying financial statements, including the notes thereto.
Background and Overview
Our company cut back daily operations in late 2005 and essentially ceased daily operations in May 2006. In September 2005, we sold certain assets to Cary Brokaw Productions, and subsequently ceased the business of producing feature films, television films and made-for-television/cable movies. Cary Brokaw also resigned from our board and as our Chief Executive Officer, President and Chief Financial Officer. Gene Feldman assumed certain duties previously held by Mr. Brokaw, including becoming our Chairman of the Board.
In May 2006, Gene Feldman was diagnosed with lymphoma and resigned from his position with us. On August 25, 2006, Gene Feldman passed away. On September 1, 2006, Mr. Feldman’s nephew, Michael D. Feldman, stepped in to become our Chairman and Chief Executive Officer, and Jerome I. Feldman, Gene Feldman’s brother and Michael D. Feldman’s father, became our Chief Financial Officer, Treasurer and Vice Chairman of the Board. In the following year, Michael D. Feldman resigned from his positions with us as an officer and director, and Jerome I. Feldman became our Chairman, Chief Executive Officer and Chief Financial Officer. From the date of Gene Feldman’s resignation through the date we entered into a Technology License Agreement (as described below), we have been substantially inactive. All monies disbursed by us from 2006 through 2009 were used to pay the previously-incurred accounting fees and for the payment of directors and officers’ insurance premiums. During that period, we have had no employees and our board of directors has not met.
Effective May 2006, we sold our remaining assets to the estate of Gene Feldman, pursuant to an agreement between Gene Feldman and us in early 2006; however, the actual closing of the transaction did not occur until January 2007.
Metallic Lithium Technology License
On February 25, 2009, we entered into a Technology License Agreement with the Amendola Family Trust, a trust created by Steven Amendola. Pursuant to the License Agreement, we acquired an exclusive, worldwide, perpetual license to use certain proprietary technology for manufacturing metallic lithium for use in batteries and other fields. We believe this technology allows for the manufacture of metallic lithium more efficiently and more inexpensively than current methods. Lithium batteries are used in cell phones, digital cameras, i-pods and many other high technology devices and applications.
More broadly, the License Agreement grants to us the rights to use, further license, sublicense and subcontract the technology to third parties for the purification, manufacture, purchase of components, quality inspection, assembly, testing, installation, commissioning and operation of the manufacturing process and sale of metallic lithium in or for batteries and related devices and other fields. A patent application relating to the licensed technology is pending.
In consideration for the license grant, we issued 1,000,000 shares of our common stock to the Amendola Family Trust, and have agreed to pay the licensor a royalty of: (i) $1.00 per kilogram of lithium product manufactured and sold, and (ii) in the event sodium is produced out of the manufacture of lithium, $0.10 per kilogram of sodium manufactured and sold. The royalty is payable by us quarterly and subject to audit rights by the licensor.
Additionally, we have agreed to issue to the Amendola Family Trust a further 2,000,000 shares of our common stock, but which shares are restricted and subject to forfeiture if there has not been at least $1,000,000 in total commercial sales of licensed products by February 25, 2012 (three years after the date of the License Agreement).
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We have also agreed to issue to the Amendola Family Trust, an option, exercisable only in the event commercial sales reach $1,000,000 as noted above and for five years after the date of the License Agreement, to purchase up to such number of shares of our common stock (“option shares”) such that the option shares, when added to the number of shares of common owned by the Amendola Family Trust or any of its affiliates prior to exercise of the option, will be equal to 19% of the total number of outstanding shares of our common stock after the exercise of the option, at an exercise price that is the same price as then current sales by us of our shares during the term of the License Agreement.
We expect our future operations will be centered around metallic lithium battery technology (an estimated market in excess of $1.0 billion according to independent industry sources). No assurance can be given, however, that we will be successful in these efforts.
Metallic lithium is distinguishable from other existing forms of battery technology in that it has a higher energy density than zinc or nickel compounds used in conventional batteries. The market for metallic lithium is now in excess of $1.0 billion according to independent industry sources and, we believe, steadily increasing. There are a number of much larger and more established firms in the business of manufacturing metallic lithium. It is our belief that utilizing our new patent pending process we would have a significant advantage in manufacturing costs over the existing companies in the field, although no assurance can be given.
Commencing in October 2010, working through a third party, we conducted a series of tests in a production environment to determine if the process covered by the Amendola patent works. The testing involved feeding lithium carbonate solution into an electrolysis tank containing a liquid metal cathode and an anode suspended in the lithium carbonate solution. Based on the results of this preliminary testing, we believe that the process is workable and can be scaled-up to a commercially feasible level. We intend to bring in a seasoned management team in the upcoming months to take the necessary steps to implement this process.
Results of Operations
Three Months Ended September 30, 2010 Compared to Three Months Ended September 30, 2009
Operations for the three months ended September 30, 2010 and 2009 consisted principally of maintaining our public company status.
Net loss for the three months ended September 30, 2010 was $21,762, compared to a loss of $24,117 for the three-month period ended September 30, 2009. We had no operations during either period and expenses consisted primarily of legal and accounting fees.
Nine Months Ended September 30, 2010 Compared to Nine Months Ended September 30, 2009
Operations for the nine months ended September 30, 2010 and 2009 consisted principally of maintaining our public company status.
Net loss for the nine months ended September 30, 2010 was $80,755, compared to a loss of $95,929 for the nine-month period ended September 30, 2009. We had no operations during either period and expenses consisted primarily of legal and accounting fees.
Liquidity and Capital Resources
As of September 30, 2010, we had negative working capital of $130,714, compared to negative working capital of $226,413, at September 30, 2009.
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We do not have sufficient funds to continue our operating activities. Future operating activities are expected to be funded by loans from officers, directors and major shareholders, until we begin to raise capital from non-officers or non-directors or generate cash flows from operations.
Off-Balance Sheet Arrangements
As of the date of this report, we have not entered into any transactions with unconsolidated entities in which we have financial guarantees, subordinated retained interests, derivative instruments or other contingent arrangements that expose us to material continuing risks, contingent liabilities or any other obligations under a variable interest in an unconsolidated entity that provides us with financing, liquidity, market risk or credit risk support.
Impact of Inflation
We believe that inflation has not had a material impact on our results of operations for the nine months ended September 30, 2010. We cannot assure you that future inflation will not have an adverse impact on our operating results and financial condition.
Application of Critical Accounting Policies and Estimates
The significant accounting policies that we believe are the most critical to aid in fully understanding and evaluating our reported financial results are as follows:
Consolidated Financial Statements
Our consolidated financial statements include the accounts our company and our wholly-owned subsidiaries. All material intercompany accounts and transactions have been eliminated.
Fair Value of Financial Instruments
Our carrying values of cash, accounts payable and accrued expenses, loan payable, note payable and due to related party approximate their fair values because of the short-term maturity of these instruments.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures 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. Significant estimates had included those had related to valuation of accounts receivable, film costs and accrued expenses.
Intangible Assets
Intangible assets, consisting of a license for an exclusive, worldwide, transferable, perpetual license to use certain proprietary technology for the processing of lithium for use in batteries and other fields, have been recorded at fair value and, as they have an indefinite life, will not be amortized. The carrying value of the intangible assets will be evaluated by us for impairment at least annually or upon the occurrence of an event which may indicated that the carrying amount may be greater than its fair value. If impaired, we will write down such impairment. In addition, the useful life of the intangible assets will be evaluated by us at least annually or upon the occurrence of an event which may indicate that the useful life may be definitive and we will commence amortization over such useful life.
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We have evaluated the fair value of our intangible assets and determined that it exceeds the carrying value based on our knowledge of the potential use of the lithium that we plan to produce in the existing market. Although are at an early stage of bringing the lithium process to produce revenues and cannot fore cast revenues, we believe that the net cash flow to be derived from the lithium will exceed the carrying value.
Income (Loss) per Common Share
Basic net income (loss) per share was computed by dividing the net income (loss) for the period by the basic weighted average number of shares outstanding during the period. Diluted net income (loss) per share was computed by dividing the net income (loss) for the period by the weighted average number and any potentially dilutive securities outstanding during the period.
Share-Based Compensation
We recognize compensation expense for all share-based payment awards made to employees, directors and others based on the estimated fair values on the date of the grant. Options are valued using the Black-Scholes Option-Pricing Model using the market price of our common stock on the date of valuation, an expected dividend yield of zero, the remaining period or maturity date of the warrants and the expected volatility of our common stock.
Deferred Income Taxes
Deferred income taxes are provided for temporary differences between financial statement and income tax reporting under the liability method, using expected tax rates and laws that are expected to be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not, that the deferred tax assets will not be realized.
New Accounting Pronouncements
We do not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
Not required.
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ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and the Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of September 30, 2010, based on their evaluation of these controls and procedures. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in reports it files or submits under the Exchange Act is accumulated and communicated to management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
We have identified certain matters that constitute material weakness (as defined under the Public Company Accounting Oversight Board Auditing Standard No. 2) in our internal controls over financial reporting. The material weaknesses that we have identified relate to the fact that that our overall financial reporting structure, internal accounting information systems and current staffing levels are not sufficient to support our financial reporting requirements. We are working to remedy our deficiency.
Changes in Internal Control over Financial Reporting
There were no changes in our internal controls over financial reporting identified in connection with the evaluation of such internal controls that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
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ITEM 1. Legal Proceedings
None
There are no material changes in the risk factors previously disclosed in our annual report on Form 10-K for the year ended December 31, 2009.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
There were no sales of unregistered securities during the three months ended September 30, 2010.
ITEM 3. Defaults upon Senior Securities
None
None
The exhibits listed in the following Exhibit Index are filed as part of this quarterly report.
Exhibit Number and Description
| 3.1 | Restated Certificate of Incorporation. (1) |
| 3.2 | Certificate of Amendment of the Restated Certificate of Incorporation. (2) |
| 3.3 | By-Laws. (1) |
| 31.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act. |
| 32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act. |
_____________
| (1) | Incorporated by reference to the exhibits included with registration of securities on Form 10-SB, filed with the U.S. Securities and Exchange Commission on April 10, 1997. |
| (2) | Incorporated by reference to the exhibits included with quarterly report on Form 10-Q, filed with the U.S. Securities and Exchange Commission on August 14, 2008. |
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SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: November 15, 2010
| ALPHA-EN CORPORATION | ||
| By: | ||
| Jerome I. Feldman | ||
| Chairman, Chief Executive Officer, Chief Financial Officer and Treasurer | ||
| (principal executive officer and principal financial and accounting officer) | ||
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