UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A |
X | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||
For the Quarterly Period Ended September 30, 2008 | |||||||
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
For the Transition Period From to | |||||||
Commission File Number 33-19107
LBO CAPITAL CORP.
(Exact name of Registrant as specified in its charter)
Colorado 38-2780733
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
23399 Commerce Drive Suite B-1
Farmington Hills MI 48335
(Address of principal executive offices)
Registrant's telephone number, including area code: (248) 994-0099
Indicate by check mark whether the Company (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for 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:
YesX No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. (as defined in Rule 12b-2 of the Exchange Act)
Large accelerated filer ___ Accelerated filer ____
Non –accelerated filer ___ Smaller reporting company X
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes No X
As of September 30, 2008 a total of 20,870,866 shares, $.0001 par value common stock, were issued and outstanding after the 1-for-8 reverse split, which became effective on May 7, 2008. Financial statements reflect the effect of the 1-for- 8 reverse split as required by GAAP.
Explanatory Note:
The Company is filing this amended report on Form 10Q/A to make the following changes to the report on Form 10Q for September 30, 2008:
1. Revised the September 30, 2008 balances in the Consolidated Balance Sheet that relate to subsidiaries Advanced Digital Components, Inc. (‘ADCI’) and Global Technologies, Inc. (“GTI”) to conform with the balances that we have calculated in our accounting system, which system was transferred in the main corporate office of the Company subsequent to the acquisition of these subsidiaries. Based on a review of the balances of ADCI and GTI as of September 30, 2008, management concluded that balances that were initially provided to us by the then accounting staff of ADCI and GTI were not correct.
2. Revised the September 30, 2008 balances in the Consolidated Income Statement for the three and nine months ended September 30, 2008 to conform with the balances that we have recorded subsequent to the acquisition of ADCI and GTI in our accounting system in the main office. The reason for this change is same as the above.
3. Revised the September 30, 2008 balances in the Consolidated Statement of Cash Flow for September 30, 2008. These balances are recalculated based on the revised numbers represented in the Consolidated Balance sheet at September 30, 2008 and Consolidated Income Statement for the nine months September 30, 2008.
4. Revised the balances shown in the “Unaudited Pro Forma Financial Information” footnote for the three and nine months ended September 30, 2008 to conform with the amended Consolidated Income Statements.
5. Revised Item. 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, to conform with the revised financial statements represented in this report.
6. Revised Item 4T. “Controls and Procedures” to represent the revised management opinion that our internal controls were not effective as of September 30, 2008 due to the subsequent findings of accounting inaccuracies related to subsidiaries ADCI and GTI financial statements.
PART I - FINANCIAL INFORMATION
Item 1. Condensed Financial Statements
LBO Capital Corp. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30, 2008 | December 31, 2007 | |||
(Unaudited) |
| |||
ASSETS | ||||
Current Assets | ||||
Cash | $ 19,417 | $ - | ||
Marketable securities | 384 | 767 | ||
Accounts receivable | - | - | ||
Prepaid expenses | 1,232 | - | ||
Total current assets | 21,033 | 767 | ||
Property and Equipment, net | 32,244 | - | ||
Other Assets | ||||
Goodwill | 17,200,454
| - | ||
Intangible assets, net | 311,092 | - | ||
Deposits | 6,300 | - | ||
Total other assets | 17,517,846 | - | ||
Total assets | 17,571,123 | 767 | ||
LIABILITIES & STOCKHOLDERS EQUITY | ||||
Current Liabilities | ||||
Accounts payable | 59,182 | - | ||
Accrued consulting fees | 585,141 | - | ||
Accrued expenses | 47,993 | - | ||
Interest payable | 557,469 | - | ||
Accrued wages | 275,149 | - | ||
Note payable-related party | 545,531 | - | ||
Total current liabilities | 2,070,465 | - | ||
Long-Term Liabilities | ||||
Note Payable-related party | 2,581,666 | - | ||
Total liabilities | 4,652,131 | - | ||
Commitments and contingencies | ||||
Stockholders' Equity | ||||
Common stock, $0.0001 par value, 100 million shares authorized, 20,870,866 and 2,012,530 shares outstanding at September 30, 2008 and December 31, 2007, respectively. | 2,087 | 201 | ||
Additional paid in capital | 15,478,453 | 2,372,939 | ||
Additional paid in capital-stock options | 69,902 | - | ||
Additional paid in capital-warrants | 657,831 | - | ||
Accumulated Deficit | (3,280,460) | (2,363,935) | ||
Other comprehensive loss | (8,821) | (8,438) | ||
Total stockholders' equity | 12,918,992 | 767 | ||
Total liabilities and stockholders' equity | $ 17,571,123 | $ 767 | ||
See notes to condensed unaudited consolidated financial statements
LBO Capital Corp. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
Three months ended September 30, | Nine months ended September 30, | |||
2008 | 2007 | 2008 | 2007 | |
Revenues | ||||
Licensing revenues | $ 5,000 | $ - | $ 5,000 | $ - |
Costs and expenses | ||||
Wages | 712 | - | 712 | - |
Rent | 400 | - | 400 | - |
Management fees | 112,500 | - | 112,500 | - |
Professional fees | 32,806 | - | 71,441 | - |
Maintenance | 205 | - | 205 | - |
Insurance | 658 | - | 658 | - |
Utilities | - | - | - | - |
Telephone | 343 | - | 343 | - |
Research & Development | 10,060 | - | 10,060 | - |
Meals and travels | 276 | - | 276 | - |
Dues and Subscriptions | - | - | 100 | - |
Office Supplies | 1,747 | - | 2,194 | - |
Depreciation | 582 | - | 582 | - |
Amortization | 1,997 | - | 1,997 | - |
Postage, printing & reproduction | 16 | - | 17 | - |
Taxes | - | - | - | - |
Patents | 2,299 | - | 2,299 | - |
Warrants expense | - | - | 657,831 | - |
Options compensation cost | 18,076 | - | 77,302 | - |
Miscellaneous | 180 | - | 217 | - |
Total operating expenses | 182,857 | - | 939,134 | - |
Interest expense | (8,677) | (22,324) | (8,691) | (66,294) |
Foreign currency adjustment | 26,301 |
| 26,301 | |
Net Loss | $ (160,233) | $ (22,324) | $ (916,524) | $ (66,294) |
Weighted Average Number of | ||||
Common Shares Outstanding | 5,819,960 | 1,512,500 | 3,391,302 | 1,512,500 |
Basic and Diluted Loss per Share | $ (0.03) | $ (0.02) | $ (0.28) | $ (0.04) |
See notes to condensed unaudited consolidated financial statements
LBO Capital Corp. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine months ended | ||||
September 30, 2008 | September 30, 2007 | |||
Operating activities: | ||||
Net loss | $ (916,524) | $ (66,294) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation | 582 | - | ||
Amortization | 1,997 | - | ||
Warrant Expense | 657,831 | - | ||
Compensation Cost-Stock Options | 77,302 | - | ||
Changes in assets and liabilities: | ||||
Increase (Decrease) in: | ||||
Accounts payable and accrued liabilities | 125,541 | - | ||
Interest payable | 7,689 |
| 66,294 | |
Total adjustments | 870,941 |
| 66,294 | |
Net cash used in operating activities | (45,583) | - | ||
Financing activities | ||||
Cash provided from contributions | 25,000 | - | ||
Cash provided from notes payable | 2,377 | - | ||
Payment of note payable | (2,377) | - | ||
Common shares issued upon exercise of stock options | 40,000 |
| - | |
Net cash provided by financing activities | 65,000 | - | ||
Net increase in cash | 19,417 |
| - | |
Cash and cash equivalents: | ||||
Balance of cash at the beginning of period | $ - |
| - | |
Balance of cash at the end of period | $ 19,417 |
| $ - | |
Supplemental disclosures of cash flow information | ||||
Cash paid for interest | - | - | ||
See notes to condensed unaudited consolidated financial statements
LBO Capital Corp. and Subsidiaries
Notes to Condensed Unaudited Consolidated Financial Statements
September 30, 2008 and 2007
1. Basis of Presentation
The accompanying unaudited interim financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2007 filed with the Securities and Exchange Commission. These financial statements, in the opinion of management, include all adjustments (consisting only of normal recurring accruals) necessary for the fair presentation of the financial position, resul ts or operations and cash flows for the periods and dates presented. Interim operating results are not necessarily indicative of operating results for the full year.
This report contains forward-looking statements including statements containing words such as “believes”, “anticipates”, “expects” and the like. All statements other than statements of historical fact included in this report are forward-looking statements. The Company believes that its expectations reflected in its forward-looking statements are reasonable, but it can give no assurance that the expectations ultimately will prove to be correct. Important factors including, without limitation, statements relating to planned acquisitions, the financial condition of the Company, integration of businesses the Company has acquired, a change in the Company’s relationships with its bank lenders and/or unsecured lenders, could cause the Company’s actual results to differ materially from those anticipated in these forward-looking statements. The Company does not intend to update the forward-looking statements contained in this report.
2. The Company
LBO Capital Corp. (the "Company" or “LBO Capital”) was incorporated on October 8, 1987. LBO Capital strives to acquire intellectual property and technology; and further, it actively seeks to identify operating companies which could benefit from licensing its owned technology and intellectual property.
Subsidiaries
Advanced Digital Components, Inc. (“ADCI”), a Delaware Corporation, formed in 2003, is a development stage entity and is primarily engaged in the development of magnetic pressure sensing (“MPS”) system which monitors the pressure inside each tire on a vehicle. ADCI has obtained a patent for the MPS system and its focus is now marketing and selling the technology. There can be no assurance that patents issued to or licensed by ADCI will not be challenged, invalidated, or circumvented, or that the rights granted thereunder will provide proprietary protection or competitive advantages to ADCI.
Global Tech International, Inc. (“GTI”), a Delaware Corporation, was incorporated in 2003. GTI is development stage entity and is primarily engaged in the developing, licensing, and marketing plastic’s related intellectual properties developed under the 3DM Powder Impression Molding (“PIM”) system and the 3DM Blow Molding system. In addition, GTI is developing and marketing the Surface Acoustic Wave (“SAW”) technology tire sensor which monitors the pressure inside each tire on a vehicle. GTI has obtained a patent for the SAW tire sensor and its focus is now on marketing and selling the technology. There can be no assurance that patents issued to or licensed by GTI will not be challenged, invalidated, or circumvented, or that the rights granted thereunder will provide proprietary protection or competitive advantag es to GTI. GTI is a participant in the projects of the USCAR and is currently working with General Motors, Ford and Chrysler in the field of weight reduction by the utilization of encapsulated lightweight composites.
ECO is an innovative company, working in a field of converting waste plastic to gasoline and diesel fuel and lubricants through the process of heat and catalysis. “Gasoline from Plastic Technology” was developed and patented by Dr. Swaminathan Ramesh. The subject IP technology, vested in ECO, relates to 'Gasoline from Plastics Technology'. Additionally, subject technology ties to conversion of Plastic Wastes including Codes 2, 4, 5, and 6 directly into value-added fuels such as gasoline, lubricants and diesel fuel.
3. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions.
4. Marketable Securities
The Company's marketable securities available for sale consist of 15,341 shares of common stock of Enercorp, Inc., an affiliate of the Company. They are recorded at fair market value. Cost basis was $9,205 at September 30, 2008 and December 31, 2007. Fair market value on September 30, 2008 and December 31, 2007 was $384 and $767 respectively.
5. Extinguishment of liabilities
Note Purchase Agreement.
Effective December 31, 2007, Quorum Capital, Inc., the major creditor of the Company, assigned $337,654 of note receivable and $904,702 of interest receivable from the Company to American Plastics Processing Products Inc (“AP3”).
Conversion of debt to equity
Effective December 31, 2007, AP3 agreed to convert $337,654 of the assigned note receivable and $904,702 of the assigned interest receivable from the Company into 200,000 shares of the Company’s common stock and 1,000,000 warrants to purchase shares of common stock at $0.08 per share.
Also, effective December 31, 2007, Quorum Capital, Inc agreed to convert $506,481 of the remaining note receivable from the Company into 300,000 common shares of the Company’s stock and 1,000,000 warrants to purchase shares of common stock at $0.08 per share.
6. Capital Stock
Public warrants
The Company has 375,000 Class A Warrants, 375,000 Class B Warrants and 375,000 Class C Warrants.
Class A warrant entitles the warrant holder to purchase one share of common stock for $4.00, each Class B warrant entitles the warrant holder to purchase one share of common stock for $6.00, and each Class C common stock purchase warrant entitles the warrant holder to purchase one share of common for $8.00. The Class A, B and C warrants were originally exercisable within twelve, eighteen and twenty-four months respectively, from February 26, 1988. All warrants have been extended until January 25, 2009. As of the day of this report, no warrants have been exercised. The Company has the right to call any or all warrants at a redemption price of $.0008 per warrant.
Private Warrants
On May 9, 2008, the Board of Directors extended the expiry date of 162,500 private warrants until May 5, 2013. These warrants were initially set to expire on June 3, 2008 and were owned by Thomas W. Itin, Chairman of the Company, since 1994. Each warrant enables the owner to purchase one share of common stock for $.32 per share.
On May 9, 2008 the Board of Directors extended the expiry date until May 5, 2013 for 375,000 private Warrants owned by Mr. Itin since 1994. Each warrant enables the owner to purchase one share of common stock for $.32 per share.
Extension of the expiry date of these warrants represents a modification of their terms, therefore based on Statement of Financial Accounting Standards No. 123 (R) “SFAS 123 (R)”, the modification of terms of an award that makes it more valuable shall be treated as an exchange of an original award for a new award resulting in additional expense for the incremental difference in value. Thus, the incremental value of $657,831 was recognized as warrant expense on May 9, 2008. These warrants are represented on the face of the balance sheet as Additional Paid in Capital-Warrants. The Company used the Binomial Tree Warrant Calculator Model to fair value these warrants. The Binomial Tree Warrant Calculator Model requires subjective assumptions, including future stock price volatility, exercise price of the warrant, interest rate equal to U.S. Treasury rate with the same maturity as the warrants and expected time to exercise the warrants.
On October 31, 2008 American Plastics Processing Products, Inc. exercised Five hundred thousand (500,000) privately held Warrants (see 5.Extinguishment of liabilities) and purchased new post 1-for-8 reverse split Five hundred thousand (500,000) shares of Common Stock of LBO Capital at the purchase price of eight cents U.S. ($0.08) per share subject to the SEC Rule 144 restrictions.
Stock option plan
The majority of Shareholders approved a 10-year Stock Option Plan at the Annual Meeting of the Shareholders held on April 3, 2008. Subject to the provisions of the Stock Option Plan, the maximum aggregate number of Shares which may be optioned and sold under the Plan or for which Stock Appreciation Rights or Stock Purchase Rights may be granted and exercised is 3,000,000 shares of common stock. The Shares may be authorized, but unissued or reacquired Common Stock. According to the Stock Option Plan, Incentive Stock Options, Nonstatutory Stock Options, Stock Appreciation Rights and Stock Purchase Rights may be granted to Employees, Officers of, Consultants to, and Non-employee Directors of, and the Chairman of the Company. Under the current plan, the exercise price of each option equals the market price of the Company’s stock on the date of grant an d an option’s maximum term is 5 years.
On May 5, 2008, each of the five members of the Board of Directors were granted Stock Options to purchase 400,000 shares of common stock at $0.40 per share vested over 4-year period. The Board of Directors considered this equity compensation plan to be a good incentive for the members of the Board. Total number of the shares awarded to all the directors is 2,000,000.
On May 5, 2008 the officers and employees of the Company were granted Stock Options to purchase a total of 225,000 shares of common stock at $0.40 per share.
The Company accounted for the award of options on May 5, 2008 in accordance with SFAS 123(R) using the straight-line method for awards with graded vesting. The Company recognizes compensation cost over the requisite service periods during which each group of options is earned. The fair value of each option grant was estimated on the date of grant using the Binominal Tree Option-Pricing model using assumptions such as future stock price volatility, exercise price of the option, interest rate equal to U.S. Treasury rate with the same maturity as the options and numbers of years until the expiration the option. Total amount of compensation expense recognized for this interim period is $59,226.
On June 30, 2008 an officer of the company exercised his Options rights under the Qualified Stock Option Agreement to purchase 100,000 shares of common stock at $0.40 per share subject to the SEC Rule 144 restrictions.
As of the date of this report no other options were exercised under the Stock Option Plan.
Equity transactions
Effective December 31, 2007, the Company converted all of its debt into 500,000 shares of common stock of the Company and 2,000,000 warrants at $0.08 per share.
On May 7, 2008, the Company affected the 1 – for - 8 reverse stock split of its issued and outstanding common shares and all of the other securities related to common stock. At the close of business day on May 7, 2008, there were 2,015,530 shares of common stock issued and outstanding. The Company recorded the effect of the 1- for – 8 reverse split of its common shares as of December 31, 2007. Therefore, the amounts represented in the Equity section of the balance sheet as of December 31, 2007 and June 30, 2008 have been reclassified in order to reflect the 1-for 8 reverse split.
The reverse stock split resulted in similar adjustments to the Company’s outstanding stock options, warrants, convertible notes and securities reserved for issuance pursuant to its current equity plans, if any. With respect to fractional shares as a result of the reverse split, the Company rounded up to the nearest whole share any stockholder's share ownership to the extent such stockholder would be entitled to receive one-half of one share of common stock or greater. The Company rounded down to the nearest whole share any stockholder's share ownership to the extent such stockholder would be entitled to receive less than one-half of one share of common stock.
On October 31, 2008 the Board of Directors of the Company approvedLicense and Royalty Agreement between LBO Capital and Environmental Recycling Technologies, PLC. Under the terms of License and Royalty Agreement LBO Capital is required to issue new post 1-for-8 reverse split Five hundred thousand (500,000) shares of common stock of LBO Capital to Environmental Recycling Technologies, PLC.
8. Acquisitions
On September 15, 2008, the Company completed the acquisition of 87% of the common stock of Global Tech International, Inc. and 86% of the common stock of Advanced Digital Components, Inc., both Delaware corporations and subsidiaries of Longborough Capital PLC (“Longborough”), a UK registered company. In exchange for these acquisitions, the Company delivered 18,000,000 newly issued shares of common stock to Longborough.
Longborough, a developer of technologies, is continuing to position itself as a player on the global level of automotive original equipment manufacturers (OEMs) and other strategic partners. ADCI and GTI, working alongside commercial partners, can offer clients a complete, total solution package. Additionally, the merger with the Company will enhance the commercial profile and status of the company while providing investors and shareholders a visible value of their investment.
On July 23, 2008 the company completed transaction on the purchase of 80% of common stock of Ecoplastifuel, Inc., (“ECO”) a Delaware Corporation in exchange for 758,336 shares of LBO Capital common stock.
Unaudited Pro Forma Financial Information
The unaudited pro forma financial information for the three and nine month periods of fiscal 2008 presented in the table below summarizes the combined results of operations of LBO Capital, GTI, ADCI and ECO (which we acquired during the third quarter) on a pro forma basis, as though the companies had been combined as of the beginning of fiscal 2007. The pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisitions had taken place at the beginning of fiscal 2007. The pro forma financial information presented includes the addition of goodwill as a result of the acquisition as well as elimination of receivable and payable balances between the companies.
The unaudited pro forma financial information for the three and nine-months ended September 30, 2007 combines the historical results of GTI and ADIC for the three and nine-months ended September 30, 2007. ECO did not have any operations prior to fiscal year 2008.
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| Three Months Ended |
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| September 30, |
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| 2008 |
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| 2007 |
| |||
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Revenues |
| $ | 20,000 | $ | - |
| ||
Net loss |
| $ | (279,413) | $ | (189,369) |
| ||
Basic and diluted loss per share |
| $ | (0.02) | $ | (0.01 | ) | ||
|
| Nine Months Ended |
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|
| September 30, |
| |||||
| 2008 |
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| 2007 |
| |||
| ||||||||
Revenues |
| $ | 20,000 | $ | - | |||
Net loss |
| $ | (1,415,528) | $ | (620,760) | |||
Basic and diluted loss per share |
| $ | (0.27) | $ | (0.04 | ) | ||
In addition the Company has signed the following letters of intents:
Letter of Intent with Load Hog Industries, Inc
On July 11, 2008, LBO Capital signed a non-binding Letter of Intent with Load Hog Industries, Inc., a Pennsylvania corporation (“Load Hog”) to acquire the assets of Load Hog. LBO Capital and Load Hog are conducting due diligence required for negotiations and preparation of a binding Asset Purchase agreement that is anticipated to complete in the next quarter.
The preliminary terms of the Letter of Intent state that at the closing the Company will deliver 575,000 newly issued shares of LBO Capital to Load Hog. In addition, the Company will cover certain obligations of Load Hog of the amount not exceeding $150,000. Furthermore, the Company will pay to Load Hog royalty fees as agreed upon.
On September 2, 2008, subsequent to signing a Letter of Intent and prior to finalizing a binding Asset Purchase Agreement, LBO Capital and Load Hog signed a Letter of Agreement. The terms of that Letter of Agreement confirm that LBO Capital intends to purchase Load Hog inspected inventory, assets, customer lists, vendor lists, equipment and tooling. As of the day of this report LBO Capital has advanced a total of $46,500 to warehouse facility in order to obtain possession and protect ownership of all Load Hog assets and for the purpose of selling the Load Hog Lift Kits. As consideration for conserving access and protecting ownership of the Load Hog assets, LBO Capital was granted the exclusive right to sell and manufacture worldwide the original and future enhanced Load Hog Lift Kits to individuals, auto and truck dealers, and distributors for a t erm ending on June 30, 2009.
Load Hog Industries, Inc., a private corporation founded in 1997, is in business of manufacturing and marketing its patented “Lift Kit” technology for aftermarket conversions of pickup trucks to fully functional dump trucks for end users in target market segments: municipalities and government sales, vocational buyers (construction and landscape), and “lifestyle” buyers. With a growing network of dealers supplemented by its e-commerce initiative, www.loadhog.com, the Load Hog name and concept are increasingly visible in the light truck market.
Letter of Intent with Weldmation, Inc.
On August 5, 2008 the Company announced that it signed a non-binding Letter of Intent with Weldmation, Inc. (“Weldmation”), a Michigan corporation, to license a Powder Impression Molding process and to commence a joint venture. The Letter of Intent confirms preliminary discussions and tentative agreements regarding a 50/50 Joint Venture for manufacture of industrial products and exploitation of certain Intellectual Property, including patents for industrial uses to OEMs and Tier 1 suppliers in the automotive sector, marine, defense and other industries.
LBO Capital and Weldmation are working diligently on preparation of a final binding Definitive Agreement to be concluded within a short period following full execution of the Letter of Intent. Weldmation is a full service provider of welding, general assembly and modular systems for the transportation, marine and defense industries. The company excels in design, build, installation and launch of automation and tooling assembly processes. Weldmation is an ISO 9001 2000 Standard certified company, having previously received other customer certifications and quality awards.
Letter of Intent with Sanitec Industries, Inc
On September 30, 2008 the Company announced that it signed a non-binding Letter of Intent with Sanitec Industries, Inc. (“Sanitec”), a California corporation. LBO Capital and Sanitec have initiated due diligence to prepare a Definitive Agreement and Joint Venture Agreement. The intent of the Agreements is to combine several unique technologies to bring to market an emission free solution for the ultimate disposition of sanitized healthcare waste through recycling.
Sanitec is an industry leader for certified green medical waste treatment and disposal and global patent holder for the Sanitec(r) Microwave Healthcare Waste Disinfection System(tm). Healthcare facilities nationwide, ranging from large hospital systems to single practitioner doctors' offices, utilize Sanitec systems to transform dangerous healthcare waste into low volume, unrecognizable, non-infectious material. Sanitec units are fully automated and approved for use in all 50 states and the District of Columbia.
9. Recently enacted pronouncements
In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities- Including an amendment of FASB Statement No. 115.” This Statement permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Board’s long-term measurement objectives for accounting for financial instruments.
This Statement also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. This Statement does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. This Statement does not establish requirements for recognizing and measuring dividend income, interest income, or interest expense. This Statement does not eliminate disclosure requirements included in other accounting standards, including requirements for disclosures about fair value measurements included in SFAS No. 157. The implementation of SFAS No. 159 is not expected to have a material impact on the Company’s results of operations and financial condition.
In December 2007, the FASB issued SFAS No. 141(R), Business Combinations, and SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements. SFAS No. 141(R) requires an acquirer to measure the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree at their fair values on the acquisition date, with goodwill being the excess value over the net identifiable assets acquired. SFAS No. 160 clarifies that a noncontrolling interest in a subsidiary should be reported as equity in the consolidated financial statements. The calculation of earnings per share will continue to be based on income amounts attributable to the parent. SFAS No. 141(R) and SFAS No. 160 are effective for financial statements issued for fiscal years beginning after December 15, 2008. Early adoption is prohibited. The Company has no t yet determined the effect on our consolidated financial statements, if any, upon adoption of SFAS No. 141(R) or SFAS No. 160.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements - an Amendment of ARB No. 51 (“SFAS 160”), which establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No. 160 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. SFAS No. 160 also requires consolidated net income to be reported at amounts that include the amounts attributable to both the parent and the noncontrolling interest. It also requires disclosure, on the face of the consolidated statement of income, of the amounts of consolidated net income attributable to the parent and to the noncontrolling interest. SFAS No. 160 also provides guidance when a subsidiary is deconsolidated and requires expanded disclosures in the consolidated financial statements that clearly identify and distinguish between the interests of the parent’s owners and the interests of the noncontrolling owners of a subsidiary. SFAS 160 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. The Company is currently evaluating the impact this statement will have on its financial position and results of operations.
In February 2008, the FASB issued FASB Staff Position No. 157-2, Effective Date of FASB Statement No. 157 (“FSP 157-2”), which delays the effective date of SFAS 157 for nonfinancial assets and nonfinancial liabilities. Therefore, the Company has delayed application of SFAS 157 to its nonfinancial assets and nonfinancial liabilities, which include assets and liabilities acquired in connection with a business combination, goodwill, intangible assets and asset retirement obligations, until January 1, 2009. The Company is currently evaluating the impact of SFAS 157 for nonfinancial assets and liabilities on the Company's financial position and results of operations.
In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities (“SFAS 161”), which amends and expands the disclosure requirements of FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities (“SFAS 133”), with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments; (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations; and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. SFAS 161 requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments and disclosures about credit-risk-related contingent features in derivative instruments. This statement applies to all entities and all derivative instruments. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The Company has not yet determined the effect on our financial statements, if any, upon adoption of SFAS No. 161.
In May, 2008, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard (“SFAS”) No. 162, “The Hierarchy of Generally Accepted Accounting Principles,” (“SFAS No. 162”). SFAS No. 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). SFAS No. 162 will be effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board’s amendments to AU Section 411, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles.” Th e FASB has stated that it does not expect SFAS No. 162 will result in a change in current practice. The application of SFAS No. 162 will have no effect on the Company’s financial position, results of operations or cash flows.
Also in May 2008, the FASB issued SFAS No. 163, "Accounting for Financial Guarantee Insurance Contracts—an interpretation of FASB Statement No. 60" (“SFAS 163”). SFAS 163 interprets Statement 60 and amends existing accounting pronouncements to clarify their application to the financial guarantee insurance contracts included within the scope of that Statement. SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years. As such, the Company is required to adopt these provisions at the beginning of the fiscal year ended December 31, 2009. The Company is currently evaluating the impact of SFAS 163 on its financial statements but does not expect it to have an effect on the Company’s financial position, results of operations or cash f lows.
In May 2008, FASB issued FSP APB 14-1,Accounting for Convertible Debt Instruments that may be Settled in Cash upon Conversion (Including Partial Cash Settlement)("FSP APB 14-1"). FSP APB 14-1 applies to convertible debt securities that, upon conversion, may be settled by the issuer fully or partially in cash. FSP APB 14-1 specifies that issuers of such instruments should separately account for the liability and equity components in a manner that will reflect the entity's nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. FSP APB 14-1 is effective for financial statements issued for fiscal years after December 15, 2008, and must be applied on a retrospective basis. Early adoption is not permitted. We ar e assessing the potential impact of this FSP on our convertible debt issuances.
In June 2008, the Financial Accounting Standards Board ("FASB") issued FASB Staff Position ("FSP") EITF 03-6-1,Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities ("FSP EITF 03-6-1"). FSP EITF 03-6-1 addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting, and therefore need to be included in the earnings allocation in computing earnings per share under the two-class method as described in SFAS No. 128,Earnings per Share. Under the guidance of FSP EITF 03-6-1, unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be inc luded in the computation of earnings-per-share pursuant to the two-class method. FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and all prior-period earnings per share data presented shall be adjusted retrospectively. Early application is not permitted. We are assessing the potential impact of this FSP on our earnings per share calculation.
In June 2008, FASB ratified EITF No. 07-5,Determining Whether an Instrument (or an Embedded Feature) Is Indexed to an Entity's Own Stock("EITF 07-5"). EITF 07-5 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument's contingent exercise and settlement provisions. EITF 07-5 is effective for financial statements issued for fiscal years beginning after December 15, 2008. Early application is not permitted. We are assessing the potential impact of this EITF on our financial condition and results of operations.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with the consolidated condensed financial statements and the related notes.
Results of Operations-Three months ended September 30, 2008 vs. September 30, 2007
The consolidated statement of operations for the three-months ended September 30, 2008 includes the results of operations of the three newly acquired subsidiaries, ADCI, GTI and ECO. ADCI and GTI were acquired effective September 15, 2008 and ECO was acquired effective July 23, 2008
The Company recorded net loss of $160,233 for this period compared to a net loss of $22,324 for the same period last year. The increase in the net loss is primarily related to the acquisition of GTI, ADCI and ECO, which are development stage enterprises. The Company had $5,000 in licensing revenues for this period.
Management fees were $112,500, research and development expense was $10,060 and professional fees were $32,806 for this period. Wages were $712 during this period. The Company recorded $8,677 of interest expense on the related party note payable. Last year the Company incurred $22,324 of interest expense on the related party note payable, subsequently sold and/or converted to equity. Amortization and depreciation were $1,997 and $582 for this period.
Results of Operations-Nine months ended September 30, 2008 vs. September 30, 2007
The consolidated statement of operations for the nine-months ended September 30, 2008 includes the results of operations of the three newly acquired subsidiaries, ADCI, GTI and ECO. ADCI and GTI were acquired effective September 15, 2008 and ECO was acquired effective July 23, 2008.
The Company recorded net loss of $916,524 for this period compared to a net loss of $66,294 for the same period last year. The increase in the net loss is primarily related to the warrant expense of $657,831 and the compensation cost of $77,302 for the stock options issued pursuant to the Stock Option Plan. Also, the acquisition of ADCI, GTI, and ECO has contributed to the rest of the expenses as shown on the face of this statement.
Management fees were $112,500, research and development expense was $10,060 and professional fees were $71,441 for this period. Wages were $712 during this period. The Company recorded $8,691 of interest expense on the related party note payable. For the same period of last year the Company incurred $66,294 of interest expense on the related party note payable, subsequently sold and/or converted to equity. Amortization and depreciation were $1,997 and $582 for this period.
Liquidity and Capital Resources
The Company is in the process of engaging into the licensing of the intellectual property and technology with several parties. The Company anticipates that there will be a revenue stream generated from these licenses fees and royalty payments. The Company is currently meeting its cash needs from related parties financing. This will continue until the Company recognizes revenues from its operations. The Company and its subsidiaries are in development stage, therefore it is expected that initially the Company will incur expenses related to research and development.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
None
Item 4T. Controls and Procedures
Disclosure Controls and Procedures
We maintain disclosure controls and procedures designed to provide reasonable assurance that
information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (Exchange Act) is recorded, processed, summarized and reported within the specified time periods and accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, with the participation of our Chairman and Chief Executive Officer (CEO) and our Vice Chairman and Chief Financial Officer (CFO), evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Exchange Act) as of September 30, 2008. Based on that evaluation, our CEO and CFO concluded that, as of that date, our disclosure controls and procedures required by paragraph (b) of Rules 13a-15 or 15d-15 were not effective at the reasonable assurance level because of the identification of material weaknesses in our internal control over financial reporting, which we view as an integral part of our disclosure controls and procedures.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining effective internal control over financial reporting. This system is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
Our internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.
Our management performed an assessment of the effectiveness of our internal control over financial reporting as of September 30, 2008, utilizing the criteria described in the “Internal Control — Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The objective of this assessment was to determine whether our internal control over financial reporting was effective as of September 30, 2008. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
In our assessment of the effectiveness of internal control over financial reporting as of September 30, 2008, we identified the following material weaknesses: During 2008 the Company acquired several businesses, and encountered some difficulties in properly recording these acquisitions in the books due to lack of oversight in accounting systems of these businesses. The Company inherited such weaknesses from these subsidiaries, and at September 30, 2008 many adjusting entries affecting the financial statements represented in this interim report were deemed necessary. Thus, the Company has filed an amendment to this interim report on Form 10Q for September 30, 2008 reflecting these adjustments.
Remediation and Changes in Internal Controls
Management has taken the following steps to correct these deficiencies:
Management has consolidated the accounting functions by transferring the accounting for the newly acquired subsidiaries to the main corporate office of the Company. This will assure better control and oversight over the accounting system and staff. In addition, there have been other changes related to cash management, such as the bank accounts and their signatories.
There have been no changes in the Company’s internal control over financial reporting (as such term defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal year ended September 30, 2008 to which this report relates that have materially affected, or are reasonably likely to affect, the Company’s internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 1A. Risk Factors
None
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None
Item 3. Defaults upon Senior Securities
None
Item 4.Submissions of matters to a vote of security holders
None
Item 5.Other information
None
Item 6. Exhibits
Exhibit No. |
| Description |
31.1 |
| Certification of Thomas W. Itin, Chief Executive Officer of the Company, pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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31.2 |
| Certification of Majlinda Xhuti, Chief Financial Officer of the Company, pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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32.1 |
| Certification of Thomas W. Itin, Chief Executive Officer of the Company, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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32.2 |
| Certification of Majlinda Xhuti, Chief Financial Officer of the Company, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
LBO CAPITAL CORP.
(Registrant)
/s/ Thomas W. Itin Date: May 15, 2009
Thomas W. Itin, President,
Chief Executive Officer
/s/ Majlinda Xhuti Date: May 15, 2009
Majlinda Xhuti, Chief Financial Officer
EXHIBIT INDEX
Exhibit No. |
| Identification of Exhibit |
31.1 |
| Certification of Thomas W. Itin, Chief Executive Officer of the Company, pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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31.2 |
| Certification of Majlinda Xhuti, Chief Financial Officer of the Company, pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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32.1 |
| Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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32.2 |
| Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
EXHIBIT 31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Chief Executive Officer
I, Thomas W. Itin certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of LBO Capital Corp.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: May 15, 2009
/s/ Thomas W. Itin |
Chief Executive Officer |
EXHIBIT 31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Chief Financial Officer
I, Majlinda Xhuti, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of LBO Capital, Corp. |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: May 15, 2009
/s/ Majlinda Xhuti |
Chief Financial Officer |
EXHIBIT 32.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
I, Thomas W. Itin, Chief Executive Officer of LBO Capital Corp. (the “Company”), hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| 1. | the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2008, to which this statement is furnished as an exhibit (the “Report”), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
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| 2. | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: May 15, 2009
/s/Thomas W Itin. | |
Chairman of the Board of Directors and | |
Chief Executive Officer |
EXHIBIT 32.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
I, Majlinda Xhuti, Chief Financial Officer of LBO Capital Corp. (the “Company”), hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| 1. | the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2008 to which this statement is furnished as an exhibit (the “Report”), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
| 2. | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: May 15, 2009
/s/Majlinda Xhuti. | |
Chief Financial Officer |
