At June 30, 2009, we did not have any revenues from operations. Our principal source of operating capital recently has been provided in the form of loans and capital contributions from our stockholders. Absent a merger or other combination with an operating company, we do not expect to have any revenues from operations. No assurance can be given that such a merger or other combination will occur or that we can engage in any public or private sales of our equity or debt securities to raise working capital. We are dependent upon future loans or capital contributions from our present stockholders and/or management and there can be no assurances that our present stockholders or management will make any loans or capital contributions to us. At June 30, 2009, we had cash of $8,688 and negative working capital of $2,820.
Our present material commitments are professional and administrative fees and expenses associated with the preparation of our filings with the U.S. Securities and Exchange Commission (“SEC”) and other regulatory requirements. In the event that we engage in any merger or other combination with an operating company, it is likely that we will have additional material commitments. Although from time to time, we may be engaged in discussions with operating companies regarding a merger or other combination, no assurances can be made that we will engage in any business merger or other business combination with an operating company within the next twelve months.
We do not have any commitments which are required to be disclosed in tabular form as of June 30, 2009.
As of June 30, 2009, we have no off-balance sheet arrangements such as guarantees, retained or contingent interest in assets transferred, obligation under a derivative instrument and obligation arising out of or a variable interest in an unconsolidated entity.
As a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information required by this item.
See the index to the Financial Statements below, beginning on page F-1.
None.
Our management, with the participation of our president and chief financial officer, carried out an evaluation of the effectiveness of our “disclosure controls and procedures” (as defined in the Exchange Act Rules 13a-15(e) and 15-d-15(e)) as of the end of the period covered by this report (the “Evaluation Date”). Based upon that evaluation, the president and chief financial officer concluded that as of the Evaluation Date, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported, within the time periods specified in the SEC’s
rules and forms and (ii) is accumulated and communicated to our management, including our president and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, including our president and chief financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, management’s evaluation of controls and procedures can only provide reasonable assurance that all control issues and instances of fraud, if any, within the Company have been detected.
(b)Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management assessed the effectiveness of our internal control over financial reporting as of June 30, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Our management has concluded that, as of June 30, 2009, our internal control over financial reporting is effective based on these criteria. This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this annual report.”
(c) Changes in Internal Control over Financial Reporting
There were no changes in our internal controls over financial reporting that occurred during the last fiscal quarter covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
| |
ITEM 9B. | OTHER INFORMATION |
None.
PART III
| |
ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. |
The following table sets forth information concerning our officers and directors as of September 1, 2009:
| | | | | | |
Name | | | Age | | Title | |
| | |
| |
| |
Arnold P. Kling | | 51 | | President and director |
Kirk M. Warshaw | | 51 | | Chief financial officer and secretary |
Arnold P. Kling. Mr. Kling has served as our president and a director since August 2007. Mr. Kling is currently a Managing Director of GH Venture Partners, LLC, a private equity and merchant banking boutique for which he also served as a Managing Director and General Counsel from 1995 to 1999. From 1999 through August 2005, Mr. Kling was the president of Adelphia Holdings, LLC, a merchant-banking firm, as well as the managing member of several private investment funds. From 1993 to 1995 he was a senior executive and general counsel of a Nasdaq listed licensing and multimedia company. From 1990 through 1993, Mr. Kling was an associate and partner in the corporate and financial services department of Tannenbaum, Helpern, Syracuse & Hirschtritt LLP, a mid-size New York law firm. Mr. Kling received a Bachelor of Science degree from New York University in International Business in 1980 and a Juris Doctor degree from Benjamin Cardozo School of Law in 1983. Mr. Kling currently also serves as a director and president of R&R Acquisition, VII, Inc., R&R Acquisition, VIII, Inc., R&R Acquisition IX, Inc., R&R Acquisition X, Inc., Rodman International
13
Enterprises I, Ltd., Rodman International Enterprise II, Ltd., and Rodman International Enterprise III, Ltd. (each a publicly reporting, non-trading company), 24Holdings, Inc. (OTCBB:TWFH), Mattmar Minerals, Inc. (OTCBB:MTMS) and Newtown Lane Marketing, Incorporated (OTCBB:NTWN).
Kirk M. Warshaw. Mr. Warshaw has served as our chief financial officer and secretary, since August 2007. Mr. Warshaw is a financial professional who, since 1990, has provided clients in a multitude of different industries with advice on accounting, corporate finance, and general business matters. Prior to starting his own consulting firm, from 1983 to 1990, he held the various titles of controller, chief financial officer, president, and chief executive officer at three separate financial institutions in New Jersey. From 1980 through 1983, Mr. Warshaw was a Senior Accountant at the public accounting firm of Deloitte, Haskins & Sells. Mr. Warshaw is a 1980 graduate of Lehigh University and has been a CPA in New Jersey since 1982. Mr. Warshaw is currently also the chief financial officer of R&R Acquisition, VII, Inc., R&R Acquisition, VIII, Inc., R&R Acquisition IX, Inc., R&R Acquisition X, Inc., Rodman International Enterprises I, Ltd., Rodman International Enterprise II, Ltd., and Rodman International Enterprise III, Ltd. (each a publicly reporting, non-trading company), Mattmar Minerals, Inc. (OTCBB:MTMS) and Newtown Lane Marketing, Incorporated (OTCBB:NTWN), and a director and the chief financial officer of 24Holdings Inc. (OTCBB:TWFH), and a director of two privately owned entities.
Mr. Kling and Mr. Warshaw are not required to commit their full time to our business affairs and they will not devote a substantial amount of time to our business affairs.
Compensation and Audit Committees
As we only have one Board member and given our limited operations, we do not have separate or independent audit or compensation committees. Our Board has determined that it does not have an “audit committee financial expert,” as that term is defined in Item 407(d)(5) of Regulation S-K. In addition, we have not adopted any procedures by which our stockholders may recommend nominees to our Board.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than ten percent of our Common Stock (collectively, the “Reporting Persons”) to report their ownership of and transactions in our Common Stock to the SEC. Copies of these reports are also required to be supplied to us. To our knowledge, during the fiscal year ended June 30, 2009 the Reporting Persons complied with all applicable Section 16(a) reporting requirements.
Code of Ethics
We have not adopted a Code of Ethics given our limited operations. We expect that following a merger or other acquisition transaction, our Board will adopt a Code of Ethics.
| |
ITEM 11. | EXECUTIVE COMPENSATION. |
Messrs. Kling and Warshaw are our sole officers and Mr. Kling is our sole director. Neither receives any regular compensation for their services rendered on our behalf. Neither Mr. Kling nor Mr. Warshaw received any compensation during the years ended June 30, 2009 and 2008. No officer or director is required to make any specific amount or percentage of his business time available to us.
While we do not presently anticipate engaging the services of professional firms that specialize in finding business acquisitions on any formal basis, we may engage such firms in the future, in which event we may be required to pay a finder’s fee or other compensation. In no event, however, will we pay a finder’s fee or commission to any of our officers and directors or any entity with which an officer or director is affiliated. We do not have any incentive or stock option plan in effect.
14
Director Compensation
We do not currently pay any cash fees to our sole director, nor do we pay director’s expenses in attending Board meetings.
Employment Agreements
We are not a party to any employment agreements.
| |
ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. |
The following table sets forth certain information as of September 23, 2009 regarding the number and percentage of our Common Stock (being our only voting securities) beneficially owned by each officer and the sole director, each person (including any “group” as that term is used in Section 13(d)(3) of the Exchange Act) known by us to own 5% or more of our Common Stock, and all officers and the sole director as a group.
| | | | | | | |
Name of Beneficial Owner | | Shares of Common Stock Beneficially Owned (1) | | Percentage of Ownership | |
| |
| |
| |
R&R Investments VI, LLC | | | | | | | |
1251 Avenue of the Americas – 20th Floor | | | | | | | |
New York, NY 10020 | | | | | | | |
Attention: David Horin, CFO | | 2,000,000 | | | 80.0 | % | |
| | | | | | | |
Arnold P. Kling (2) | | | | | | | |
712 Fifth Avenue – 11th Floor | | | | | | | |
New York, NY 10019 | | 400,000 | | | 16.0 | % | |
| | | | | | | |
Kirk M. Warshaw (3) | | | | | | | |
15 Linden Drive | | | | | | | |
Madison, NJ 07940 | | 100,000 | | | 4.0 | % | |
| | | | | | | |
All Directors and Officers (2 persons) as a group | | 500,000 | | | 20.0 | % | |
| | | | | | | |
| | |
| (1) | Unless otherwise indicated, we have been advised that all individuals or entities listed have the sole power to vote and dispose of the number of shares set forth opposite their names. For purposes of computing the number and percentage of shares beneficially owned by a security holder, any shares which such person has the right to acquire within 60 days of September 23, 2009 are deemed to be outstanding, but those shares are not deemed to be outstanding for the purpose of computing the percentage ownership of any other security holder. |
| | |
| (2) | Arnold P. Kling, our president and sole director.. |
| | |
| (3) | Mr. Warshaw is our chief financial officer and secretary. |
We currently do not have any equity compensation plans.
15
| |
ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. |
Our Board consists solely of Arnold Kling. He is not independent as such term is defined by a national securities exchange or an inter-dealer quotation system. During the fiscal year ended June 30, 2009, the parent company of R&R Investments VI, LLC contributed capital to us in the amount of $30,500.
On January 29, 2009, we entered into an agreement with Kirk M. Warshaw, LLC (the “LLC”) for the use and occupancy, and administrative services, related to our principal offices. The agreement provides for quarterly payments from us to the LLC of $500. The effective date of the agreement is January 1, 2009. Kirk Warshaw, our chief financial officer, is a managing member of the LLC.
| |
ITEM 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
AUDIT FEES:
For the years ended June 30, 2009 and 2008, we were billed $12,000 and $12,000, respectively, by Sherb & Co. LLP, our independent accountants (“Sherb”), for professional services rendered for the audit of our annual financial statements and review of our quarterly reports on Form 10-Q or services that are normally provided in connection with statutory and regulatory filings.
AUDIT-RELATED FEES:
None.
TAX FEES:
For the years ended June 30, 2009 and 2008, we were billed $1,000 and $1,000, respectively, by Sherb for tax related services.
ALL OTHER FEES:
None.
AUDIT COMMITTEE POLICIES AND PROCEDURES:
We do not currently have a standing audit committee. The above services were approved by the Board.
PART IV
| |
ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. |
| | |
| (a) | The following documents are filed as part of this Report: |
| | |
1.Financial Statements. The following financial statements and the report of our independent registered public accounting firm, are filed herewith. |
| | |
| • | Report of Independent Registered Public Accounting Firm |
| | |
| • | Balance Sheets at June 30, 2009 and 2008 |
| | |
| • | Statements of Operations for the years ended June 30, 2009 and 2008 and for the period from June 2, 2006 (Date of Inception) to June 30, 2009 |
16
| | |
| • | Statements of Changes in Stockholders’ Equity (Deficit) for the period from June 2, 2006 (Date of Inception) to June 30, 2009 |
| | |
| • | Statements of Cash Flows for the years ended June 30, 2009 and 2008 and for the period from June 2, 2006 (Date of Inception) to June 30, 2009 |
| | |
| • | Notes to Financial Statements |
2.Financial Statement Schedules.
Schedules are omitted because the information required is not applicable or the required information is shown in the financial statements or notes thereto.
3.Exhibits Incorporated by Reference or Filed with this Report.
| | | |
Exhibit No. | | Description |
| |
|
3.1 | | | Certificate of Incorporation(1) |
3.2 | | | By-Laws (1) |
10.1 | | | Occupancy Agreement between R&R Acquisition VI, Inc. and Kirk M. Warshaw, LLC (2) |
31.1 | | | Chief Executive Officer Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002* |
31.2 | | | Chief Financial Officer Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002* |
32.1 | | | Chief Executive Officer Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002.* |
32.2 | | | Chief Financial Officer Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002.* |
| | |
| (1) | Filed as an exhibit to the Company’s registration statement on Form 10-SB, as filed with the Securities and Exchange Commission on July 10, 2006, and incorporated herein by this reference |
| | |
| (2) | Previously filed as an Exhibit in the company’s quarterly report on Form 10-Q for the period ended March 31, 2009, and incorporated herein by reference. |
17
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | |
| R&R ACQUISITION VI, INC. |
| |
Date: September 23, 2009 | |
| |
| By: /s/Arnold P. Kling |
| |
|
| Arnold P. Kling, President |
In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| |
Date September 23, 2009 | |
| |
| /s/Arnold P. Kling |
|
|
| Arnold P. Kling, President and Sole Director |
| (Principal Executive Officer) |
| |
Date: September 23, 2009 | |
| |
| /s/Kirk M. Warshaw |
|
|
| Kirk M. Warshaw, Chief Financial Officer |
| (Principal Financial and Accounting Officer) |
18
R&R ACQUISITION VI, INC.
(A Development Stage Company)
INDEX TO FINANCIAL STATEMENTS
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Stockholders and Directors
R&R Acquisition VI, Inc.
(A Development Stage Company)
Chatham, New Jersey
We have audited the accompanying balance sheets of R&R Acquisition VI, Inc. (a Development Stage Company) (the “Company”) as of June 30, 2009 and 2008 and the related statements of operations, changes in stockholders’ equity (deficit) and cash flows for the years ended June 30, 2009 and 2008, and for the cumulative period from June 2, 2006 (Date of Inception) to June 30, 2009. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of R&R Acquisition VI, Inc. (a Development Stage Company) as of June 30, 2009 and 2008, and the results of its operations and its cash flows for the years ended June 30, 2009 and 2008, and for the cumulative period from June 2, 2006 (Date of Inception) to June 30, 2009 in conformity with accounting principles generally accepted in the United States of America.
| |
| /s/SHERB & CO, LLP |
| |
| Certified Public Accountants |
New York, NY | |
September 14, 2009 | |
F-2
R&R ACQUISITION VI, INC.
(A Development Stage Company)
BALANCE SHEETS
| | | | | | | |
| | | June 30, | |
| |
|
|
| | 2009 | | 2008 | |
| |
|
|
|
|
ASSETS | | | | | |
Current Assets | | | | | | | |
Cash and cash equivalents | | $ | 8,688 | | $ | 2,647 | |
| |
|
|
|
|
|
|
| | | | | | | |
TOTAL ASSETS | | $ | 8,688 | | $ | 2,647 | |
| |
|
|
|
|
|
|
| | | | | | | |
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY | | | | | | | |
Current Liabilities | | | | | | | |
Accrued expenses | | $ | 11,508 | | $ | 15,958 | |
| | | | | | | |
| |
|
|
|
|
|
|
| | | | | | | |
TOTAL CURRENT LIABILITIES | | | 11,508 | | | 15,958 | |
| |
|
|
|
|
|
|
| | | | | | | |
STOCKHOLDERS’ DEFICIENCY | | | | | | | |
Preferred stock; $.0001 par value, 10,000,000 shares authorized, none issued and outstanding | | | — | | | — | |
Common stock, $.0001 par value, 75,000,000 shares authorized, 2,500,000 shares issued and outstanding | | | 250 | | | 250 | |
Additional paid-in capital | | | 90,000 | | | 59,500 | |
Deficit accumulated during the development period | | | (93,070 | ) | | (73,061 | ) |
| |
|
|
|
|
|
|
TOTAL STOCKHOLDERS’ DEFICIENCY | | | (2,820 | ) | | (13,311 | ) |
| |
|
|
|
|
|
|
| | | | | | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIENCY | | $ | 8,688 | | $ | 2,647 | |
| |
|
|
|
|
|
|
The accompanying notes are an integral part of these financial statements.
F-3
R&R ACQUISITION VI, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
| | | | | | | | | | |
| | | | | | | | | For the period from June 2, 2006 (Date of Inception) to June 30, 2009 | |
| | | | | | | | | |
| | Year Ended June 30, | | | |
| | | | |
| | | 2009 | | | 2008 | | | |
| |
|
|
|
|
|
|
|
| |
Expenses | | | | | | | | | | |
Professional fees | | $ | 17,000 | | $ | 20,250 | | $ | 79,750 | |
Printing and filing fees | | | 3,020 | | | 4,666 | | | 13,421 | |
| |
|
|
|
|
|
|
|
| |
Total operating expenses | | | 20,020 | | | 24,916 | | | 93,171 | |
Interest Income | | | 11 | | | 25 | | | 101 | |
| |
|
|
|
|
|
|
|
| |
Net loss | | $ | (20,009 | ) | $ | (24,891 | ) | $ | (93,070 | ) |
| |
|
|
|
|
|
|
|
| |
| | | | | | | | | | |
Weighted average number of common shares outstanding – basic and diluted | | | 2,500,000 | | | 2,500,000 | | | | |
| |
|
|
|
|
|
| | | |
|
Net loss per share – basic and diluted | | $ | (0.01 | ) | $ | (0.01 | ) | | | |
| |
|
|
|
|
|
| | | |
The accompanying notes are an integral part of these financial statements.
F-4
R&R ACQUISITION VI, INC.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
For the Period from June 2, 2006 (Date of Inception) to June 30, 2009
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | Additional Paid-in Capital | | Deficit Accumulated During the Development Stage | | Total Stockholders’ Equity (Deficit) | |
| | Preferred Stock- Par value of $.0001 per share | | Common Stock- Par value of $.0001 per share | |
| |
|
|
| |
| | Shares | | Amount | | Shares | | Amount | |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shares issued (inception) (June 2, 2006 $0.0001 per share) | | | — | | $ | — | | | 2,500,000 | | $ | 250 | | $ | — | | $ | — | | $ | (250 | ) |
| | | | | | | | | | | | | | | | | | | | | | |
Contributed capital, June 8, 2006 | | | — | | | — | | | — | | | — | | | 40,000 | | | — | | | 40,000 | |
| | | | | | | | | | | | | | | | | | | | | | |
Net loss | | | — | | | — | | | — | | | | | | — | | | (18,483 | ) | | (18,483 | ) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2006 | | | — | | | — | | | 2,500,000 | | | 250 | | | 40,000 | | | (18,483 | ) | | 21,767 | |
| | | | | | | | | | | | | | | | | | | | | | |
Contributed capital | | | — | | | — | | | — | | | — | | | 12,500 | | | — | | | 12,500 | |
| | | | | | | | | | | | | | | | | | | | | | |
Net loss | | | — | | | — | | | — | | | — | | | — | | | (29,687 | ) | | (29,687 | ) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2007 | | | — | | | — | | | 2,500,000 | | | 250 | | | 52,500 | | | (48,170 | ) | | 4,580 | |
| | | | | | | | | | | | | | | | | | | | | | |
Contributed capital | | | — | | | — | | | — | | | — | | | 7,000 | | | — | | | 7,000 | |
| | | | | | | | | | | | | | | | | | | | | | |
Net loss | | | — | | | — | | | — | | | — | | | — | | | (24,891 | ) | | (24,891 | ) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2008 | | | — | | $ | — | | | 2,500,000 | | | 250 | | | 59,500 | | | (73,061 | ) | | (13,311 | ) |
| | | | | | | | | | | | | | | | | | | | | | |
Contributed capital | | | — | | | — | | | — | | | — | | | 30,500 | | | — | | | 30,500 | |
Net loss | | | — | | | — | | | — | | | — | | | — | | | (20,009 | ) | | (20,009 | ) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2009 | | | — | | $ | — | | | 2,500,000 | | $ | 250 | | $ | 90,000 | | $ | (93,070 | ) | $ | (2,820 | ) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these financial statements.
F-5
R&R ACQUISITION VI, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
| | | | | | | | | | |
| | | | For the cumulative period from June 2, 2006 (Date of Inception) to June 30, 2009 | |
| | For the Years Ended June 30, | | |
| | 2009 | | 2008 | | |
| |
|
|
|
|
| |
|
CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | | | | |
Net loss | | $ | (20,009 | ) | $ | (24,891 | ) | $ | (93,070 | ) |
Changes in operating assets and liabilities | | | | | | | | | | |
Increase (decrease) in accrued expenses | | | (4,450 | ) | | 5,886 | | | 11,508 | |
| |
|
|
|
|
|
|
|
| |
NET CASH USED IN OPERATING ACTIVITIES | | | (24,459 | ) | | (19,005 | ) | | (81,562 | ) |
| |
|
|
|
|
|
|
|
| |
| | | | | | | | | | |
CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | | | |
Proceeds received from subscribers of common stock | | | — | | | — | | | 250 | |
Contributed capital | | | 30,500 | | | 7,000 | | | 90,000 | |
| |
|
|
|
|
|
|
|
| |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | 30,500 | | | 7,000 | | | 90,250 | |
| |
|
|
|
|
|
|
|
| |
| | | | | | | | | | |
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | | | 6,041 | | | (12,005 | ) | | 8,688 | |
| | | | | | | | | | |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | | | 2,647 | | | 14,652 | | | — | |
| |
|
|
|
|
|
|
|
| |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | | $ | 8,688 | | $ | 2,647 | | $ | 8,688 | |
| |
|
|
|
|
|
|
|
| |
| | | | | | | | | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION | | | | | | | | | | |
Interest paid | | $ | — | | $ | — | | $ | — | |
| |
|
|
|
|
|
|
|
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Income taxes paid | | $ | — | | $ | — | | $ | — | |
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The accompanying notes are an integral part of these financial statements.
F-6
R&R ACQUISITION VI, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Years ended June 30, 2009 and 2008
NOTE 1 - Organization, Business and Operations
R&R ACQUISITION VI, INC. (the “Company”) was incorporated in Delaware with the objective to acquire, or merge with, an operating business. On June 2, 2006, the Company sold 2,500,000 shares of common stock for $250. As of June 30, 2009, the Company had not yet commenced any operations.
The Company, based on proposed business activities, is a “blank check” company. The Securities and Exchange Commission defines such a Company as “a development stage company” that has no specific business plan or purpose, or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person; and is issued ‘penny stock,’ as defined in Rule 3a 51-1 under the Securities Exchange Act of 1934, as amended. Many states have enacted statutes, rules and regulations limiting the sale of securities of “blank check” companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in its securities, either debt or equity, until the Company concludes a business combination.
The Company was organized as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held corporation and, to a lesser extent that desires to employ the Company’s funds in its business.
The Company’s plan of operation for the next twelve months shall be to locate a suitable acquisition or merger candidate. The Company is not currently engaged in any business activities that provide cash flow. The Company believes that its cash requirements for the next twelve months will be paid with money in its treasury. If additional amounts are needed, the Company believes that it can satisfy such requirement from additional loans or investments from its stockholders, management or other investors when needed. Although the Company anticipates that its cash-on-hand would be able to satisfy its cash requirements for at least the next twelve months, the Company can provide no assurance that it will be able to do so or that if additional amounts are needed that it will be able to obtain such amounts from its stockholders, management or other investors when needed.
NOTE 2 - Summary of Significant Accounting Policies
The Company’s accounting policies are in accordance with accounting principles generally accepted in the United States of America. Outlined below are those policies considered particularly significant.
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| (a) Use of Estimates: |
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| | In preparing financial statements in accordance with accounting principles generally accepted in the United States of America, management makes certain estimates and assumptions, where applicable, that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. While actual results could differ from those estimates, management does not expect such variances, if any, to have a material effect on the financial statements. |
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| (b) Statements of Cash Flows: |
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| | For purposes of the statements of cash flows the Company considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents. |
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| (c) Earnings (Loss) Per Share: |
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| | Basic earnings (loss) per share has been computed on the basis of the weighted average number of common shares outstanding during each period presented according to the provisions of SFAS No. 128 “EARNINGS PER SHARE”. Diluted earnings (loss) per |
F-7
R&R ACQUISITION VI, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Years ended June 30, 2009 and 2008
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
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| | share reflects the potential dilution that could occur if options or other contracts to issue shares of common stock were exercised or converted to common stock as long as the effect of their inclusion is not anti-dilutive. We currently have no options or contracts to issue shares of common stock outstanding. |
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| (d) Income Taxes: |
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| | The asset and liability method is used in accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for operating loss and tax credit carry forwards and for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets unless it is more likely than not that such assets will be realized. |
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| (e) Financial Instruments |
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| | The estimated fair values of all reported assets and liabilities which represent financial instruments, none of which are held for trading purposes, approximate their carrying value because of the short term maturity of these instruments or the stated interest rates are indicative of market interest rates. |
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| (f) Equity Based Compensation |
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| | The Company adopted SFAS No. 123R, “Share Based Payments.” SFAS No. 123R requires companies to expense the value of employee stock options and similar awards and applies to all outstanding and vested stock-based awards. |
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| | In computing the impact, the fair value of each option is estimated on the date of grant based on the Black-Scholes options-pricing model utilizing certain assumptions for a risk free interest rate; volatility; and expected remaining lives of the awards. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if factors change and the Company uses different assumptions, the Company’s stock-based compensation expense could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. In estimating the Company’s forfeiture rate, the Company analyzed its historical forfeiture rate, the remaining lives of unvested options, and the amount of vested options as a percentage of total options outstanding. If the Company’s actual forfeiture rate is materially different from its estimate, or if the Company reevaluates the forfeiture rate in the future, the stock-based compensation expense could be significantly different from what we have recorded in the current period. The last equity based compensation issued by the Company was more than two years ago and such shares were fully vested upon issuance, hence an expense was recorded at that time. |
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| (g) New Accounting Pronouncements |
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| | FASB 141(revised 2007) – Business Combinations |
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| | In December 2007, the FASB issued FASB Statement No. 141 (revised 2007), Business Combinations. This Statement replaces FASB Statement No. 141, Business Combinations. This Statement retains the fundamental requirements in Statement 141 that the acquisition method of accounting (which Statement 141 called the purchase method) be used for all business combinations and for an acquirer to be identified for each business combination. This Statement defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control. This Statement’s scope is broader than that of Statement 141, which applied only to business combinations in which control was obtained by transferring consideration. By applying the same method of accounting—the acquisition method—to all transactions and other events in which one |
F-8
R&R ACQUISITION VI, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Years ended June 30, 2009 and 2008
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
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| (g) New Accounting Pronouncements (continued): |
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| | entity obtains control over one or more other businesses, this Statement improves the comparability of the information about business combinations provided in financial reports. |
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| | This Statement requires an acquirer to recognize the assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at the acquisition date, measured at their fair values as of that date, with limited exceptions specified in the Statement. That replaces Statement 141’s cost-allocation process, which required the cost of an acquisition to be allocated to the individual assets acquired and liabilities assumed based on their estimated fair values. |
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| | This Statement applies to all transactions or other events in which an entity (the acquirer) obtains control of one or more businesses (the acquirer), including those sometimes referred to as “true mergers” or “mergers of equals” and combinations achieved without the transfer of consideration, for example, by contract alone or through the lapse of minority veto rights. This Statement applies to all business entities, including mutual entities that previously used the pooling-of-interests method of accounting for some business combinations. It does not apply to: (a) The formation of a joint venture, (b) The acquisition of an asset or a group of assets that does not constitute a business, (c) A combination between entities or businesses under common control, (d) A combination between not-for-profit organizations or the acquisition of a for-profit business by a not-for-profit organization. |
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| | This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. Management believes this Statement will have no impact on the financial statements of the Company once adopted until the Company effectuates a merger or acquisition with a yet-to-be identified operating company or business. |
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| | FASB 160 – Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51 |
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| | In December 2007, the FASB issued FASB Statement No. 160 - Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51. This Statement applies to all entities that prepare consolidated financial statements, except not-for-profit organizations, but will affect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. Not-for-profit organizations should continue to apply the guidance in Accounting Research Bulletin No. 51, Consolidated Financial Statements, before the amendments made by this Statement, and any other applicable standards, until the Board issues interpretative guidance. |
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| | This Statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this Statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This Statement improves comparability by eliminating that diversity. |
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| | A noncontrolling interest, sometimes called a minority interest, is the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. The objective of this Statement is to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: (a) The ownership interests in subsidiaries held by parties other than the parent be clearly identified, labeled, and presented in the consolidated statement of financial position within equity, but separate from the parent’s equity, (b) The amount of consolidated net income attributable to the parent and to the noncontrolling interest be clearly identified and presented on the face of the consolidated statement of income, (c) Changes in a parent’s ownership interest while the parent retains its controlling financial interest in its |
F-9
R&R ACQUISITION VI, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Years ended June 30, 2009 and 2008
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
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| (g) New Accounting Pronouncements (continued): |
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| | subsidiary be accounted for consistently. A parent’s ownership interest in a subsidiary changes if the parent purchases additional ownership interests in its subsidiary or if the parent sells some of its ownership interests in its subsidiary. It also changes if the subsidiary reacquires some of its ownership interests or the subsidiary issues additional ownership interests. All of those transactions are economically similar, and this Statement requires that they be accounted for similarly, as equity transactions, (d) When a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value. The gain or loss on the deconsolidation of the subsidiary is measured using the fair value of any noncontrolling equity investment rather than the carrying amount of that retained investment, (e) Entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. |
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| | This Statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends). Earlier adoption is prohibited. This Statement shall be applied prospectively as of the beginning of the fiscal year in which this Statement is initially applied, except for the presentation and disclosure requirements. The presentation and disclosure requirements shall be applied retrospectively for all periods presented. Management believes this Statement will have no impact on the financial statements of the Company once adopted. |
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| | In May 2009, Statement of Financial Accounting Standards No. 165 – Subsequent Events was issued. The objective of this Statement is to establish general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In accordance with this Statement, an entity should apply the requirements to interim or annual financial periods ending after June 15, 2009. Management has adopted this new standard with the filing of the second quarter interim financial statements. The adoption of this new standard is not expected to have a material impact on the financial statements of the Company. |
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| | 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 financial statements upon adoption. |
NOTE 3 - Common Stock
On June 8, 2006, the Company sold 2,500,000 shares of its common stock to three accredited related party investors pursuant to a Private Placement Offering at par value for a total of $250.
On that date, a stockholder also contributed an additional $40,000 to the Company. During the fiscal years ended June 30, 2009 and 2008, the same stockholder contributed an additional $30,500 and $7,000, respectively.
NOTE 4 - Preferred Stock
The Company is authorized to issue 10,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Board of Directors.
F-10
R&R ACQUISITION VI, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Years ended June 30, 2009 and 2008
NOTE 5 – Income Taxes
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| | June 30, | |
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| | 2009 | | 2008 | |
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Deferred tax assets and liabilities consist of the following: | | | | | | | |
Deferred tax assets: | | | | | | | |
Net operating loss carry forwards | | $ | 37,000 | | $ | 29,000 | |
Less valuation allowance | | $ | (37,000 | ) | $ | (29,000 | ) |
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| | $ | — | | $ | — | |
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The provision for income taxes differs from the amount computed by applying the US statutory tax rate as follows: |
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| | June 30, | |
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| | 2009 | | 2008 | |
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Provision for expected federal statutory rate | | | (35 | )% | | (35 | )% |
Loss for which no benefit is available or a valuation allowance has been recorded | | | 35 | % | | 35 | % |
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| | | — | % | | — | % |
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At June 30, 2009, the Company had approximately $93,000 of net operating loss carry forwards (“NOL’s”) available which expires in years beginning in 2029. The deferred tax asset and related valuation increased by $8,000 during 2009.
NOTE 6 - Commitments and Contingencies
Office Space
On January 29, 2009, effective as of January 1, 2009, the Company entered into an agreement with Kirk M. Warshaw, LLC (the “LLC”) for the use and occupancy, and administrative services, related to its principal offices. The agreement provides for quarterly payments from the Company to the LLC of $500.
NOTE 7 – Subsequent Events
The Company has evaluated subsequent events through September 14, 2009, and has determined that there were no subsequent events to recognize or disclose in these financial statements.
F-11