UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
AMENDMENT NO. 1
TO
FORM 10-K
(MARK ONE)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the annual period ended December 31, 2007
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________ to _________
COMMISSION FILE NO. 000-15303
---------
NT HOLDING CORP.
(Now known as HST Global, Inc.)
(Name of Small Business Issuer in Its Charter)
NEVADA 65-1129912
------------------------------ ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
1325 Airmotive #175
Reno, NV, 89502
---------------
(Address of principal executive offices)
(775) 262-0128
--------------
(Issuer's telephone number, including area code)
Securities Registered Pursuant to Section 12(b) of the Act: None.
----
Securities Registered Pursuant to Section 12(g) of the Act: None.
-----
Check whether the issuer is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act. Yes [ ] No [X ]
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports); and (2)
has been subject to such filing requirements for the past 90 days. Yes [X]
No [ ]
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Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this form 10-K
or any amendment to this Form 10-K. [ ]
Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X]
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer or a smaller reporting company:
Large accelerated filer [ ] Accelerated filed [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
The issuer's revenues for the fiscal year ended December 31, 2007 were $0
The aggregate market value of the registrant's common stock held by
non-affiliates as of March 31, 2008 was $320,308/.15.
State the number of shares outstanding of each of the issuer's classes of
equity securities, as of the latest practicable date:
Number of Shares Outstanding
Title of Each Class of Equity Securities as of March 31, 2008
---------------------------------------- ----------------------------
Common Stock, $0.001 par value 25,839,203
Documents incorporated by reference: Form 10-K for the Year Ended December
31, 2007.
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
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TABLE OF CONTENTS
PART I
Item 1. Description of Business 4
Item 2 Description of Properties 8
Item 3. Legal Proceedings 8
Item 4. Submission of Matters to a Vote of Security Holders 8
PART II
Item 5. Market for Common Equity and Related Stockholder Matters 8
Item 6. Management's Discussion and Analysis or Plan of Operation 9
Item 7. Financial Statements 16
Item 8. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 16
Item 8A. Controls and Procedures 17
PART III
Item 9. Directors and Executive Officers of the Registrant 19
Item 10. Executive Compensation 20
Item 11. Security Ownership of Certain Beneficial Owners and Management 21
Item 12. Certain Relationships and Related Transactions 21
Item 13. Exhibits 21
Item 14. Principal Accountant Fees and Services 22
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This annual report contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These include statements
about our expectations, beliefs, intentions or strategies for the future, which
we indicate by words or phrases such as "anticipate," "expect," "intend,"
"plan," "will," "we believe," "our company believes," "management believes" and
similar language. These forward-looking statements are based on our current
expectations and are subject to certain risks, uncertainties and assumptions,
including those set forth in the discussion under Item 1. Description of
Business", and Item 6. "Management's Discussion and Analysis", including under
the heading "- Risk Factors" under Item 6. Our actual results may differ
materially from results anticipated in these forward-looking statements. We base
our forward-looking statements on information currently available to us, and we
assume no obligation to update them. In addition, our historical financial
performance is not necessarily indicative of the results that may be expected in
the future and we believe that such comparisons cannot be relied upon as
indicators of future performance.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
SUMMARY
NT Holding Corp., (the "Company", "we", "our", "us" or "NTHH") through its
subsidiaries, invests in and operates companies in Asia that engage in the
energy and natural resources businesses. Our headquarters are in Nevada
However, we will not restrict our search to energy and natural resources
businesses in any particular geographic location. We have invested in and
currently operate one subsidiary: PT Borneo Mineral Projects ("PT Borneo"), an
Indonesia company owns a right of concession on coal mines in Indonesia through
Eastbay Management Limited ("Eastbay")
HISTORY AND RECENT DEVELOPMENTS
We were incorporated on April 11, 1984 under the laws of the State of
Delaware as CMS Advertising. On September 25, 1989 we changed our name to Unico,
Inc., and on April 25, 2002, we again changed our name to ABSS, Corp.
On November 1, 2005, pursuant to the terms of an Agreement for Share
Exchange (the "Tagalder Share Exchange Agreement") entered into by and among us,
Alan Lew, Tagalder C3 Holdings Inc., a British Virgin Islands corporation
("Tagalder"), and the Shareholders of Tagalder (collectively the
"Shareholders"), we acquired all of the issued and outstanding common stock of
Tagalder from the Shareholders in exchange for a total of 19,946,000 shares of
our common stock (the "Tagalder Exchange Shares"). Following the issuance of the
Tagalder Exchange Shares, we had a total of 23,782,665 shares of common stock
issued and outstanding. Pursuant to the terms of the Tagalder Share Exchange
Agreement, additional consideration of $150,000 shall be paid to PNC upon the
earlier to occur of (a) successfully raising at least $150,000 from third party
investors, or (b) November 1, 2006. As of December 31, 2006, we paid $140,000
to PNC.
On April 7, 2006, we entered into a material definitive agreement with
Grand Canal Entertainment, Inc., a Delaware corporation ("Grand Canal") wherein
Grand Canal has agreed to purchase from us all of the outstanding ownership of
Tagalder. On October 31, 2006, we
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entered into a Rescission Agreement (the "Rescission Agreement") with Grand
Canal rescinding all previous agreements between the parties. The parties had
previously entered into two agreements: (i) an agreement on June 17, 2006
wherein the parties agreed that Grand Canal would return the interest in
Tagalder C3 Holdings to us and that us will be obligated to provide Grand Canal
with substitute consideration agreeable to Grand Canal within 60 days of the
date of the Substitution Agreement; and (ii) an agreement on April 7, 2006,
wherein we sold all of our interest in Tagalder C3 Holdings to Grand Canal in
exchange for 39,702,080 shares of Grand Canal. Due to certain subsequent events,
the parties mutually determined that it was in the best interest of each of the
parties to execute the Rescission Agreement, rescind both of these agreements
and unwinding the deal altogether.
On September 27, 2006, we entered into a material definitive agreement with
Shanxi Linfen Lingu Coal Mine Limited ("Lingu"), a coal mining company located
in Shanxi, China. We purchased 62.5% of the equity ownership of Lingu through
Grand Canal. The total consideration to be issued by us will be 9,023,200 shares
of the common stock of Grand Canal that is owned by us in exchange for 62.5% of
the equity ownership of Lingu. The closing of the Agreement is subject to the
successful completion of due diligence by us and approval by our Board of
Directors. As of December 31, 2006 and as of the date of this report, our board
of directors was not satisfied with the due diligence results of Lingu and the
acquisition of Lingu was not closed. Our board of directors determined that we
will not acquire the equity interest of Lingu.
On June 2, 2006, we completed an acquisition signed on May 10, 2006, which
through its wholly owned subsidiary Eastbay Management Limited, a British Virgin
Islands company ("Eastbay"), entered into a material definitive agreement by and
among Chris Flanagan and Michael Alsop, the major shareholders of PT Borneo
Mineral Projects and PT Borneo Mineral Projects ("PT Borneo"). PT Borneo was
formed in September 2005 in Indonesia and is in the business of coal mining and
export. It owns a right of concession on coal mines on a total area of 19,191
hectares in the territory of East Kalimantan of the Republic of Indonesia.
Pursuant to the terms of the agreement, the current shareholders of PT Borneo
will own 30% of the equity and Eastbay will acquire the remaining 70%. The
transaction was completed on June 2, 2006.
On June 19, 2006, we entered into a Purchase and Sale Agreement with System
Wealth Limited ("System Wealth") wherein we agreed to transfer all of its
interests in Tagalder to System Wealth in exchange for $800,000 to be paid in
installments over a six month period. The loss from the operations of Tagalder
was recorded as loss from discontinued operations in the statements of
operations for both the current period and for the period ended September 30,
2005.
On June 30, 2006, through AAMI, we closed an acquisition to acquired 58% of
the equity of Jinhai in exchange for $2,000,000, payable on or before March 15,
2007. Jinhai is a Chinese corporation that engages in coking coal and steel
production and is located in Shanxi Province in China. Jinhai currently employs
approximately 500 employees and its production facilities occupy a landmass of
approximately 2 million square feet. The current production capability of Jinhai
reached an annual output of approximately 180,000 tons of coking coal and
200,000 tons of steel. As of May 17, 2007 we have not made the $2,000,000
payment to the shareholder of Jinhai.
On June 6, 2007, two of the our majority shareholders, Fugu Enterprises,
Inc. ("Fugu") and TG Wanasports Management Limited "("TG Wanasports"), entered
into separate agreements with Liu Xiu Lun ("Liu"). Under the agreements, Fugu
transferred 7,941,408 shares of common stock of the Company to Liu for a
consideration of $130,320, while TG Wanasports
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transferred 10,338,200 shares of common stock of the Company to Liu for a
consideration of $169,680. The transaction was completed on June 7, 2007 and
resulted in a change in control of the Company.
On June 8, 2007, we entered into and completed a Stock Purchase Agreement
with Liang Yan Qiong to sell all of the stock in Perfect Growth Venture Corp.
("Perfect Growth"), a British Virgin Islands company wholly-owned by the Company
that holds the ownership of Jinhai and AAMI. As consideration, Mr. Liang assumed
certain liabilities and certain assets of the Company including (i) $2 million
in liabilities associated with Perfect Growth owed to the former owners of
Jinhai, and (ii) $502,156 accounts receivable (as of June 30, 2007) from System
Wealth (from sales of Shanxi Fujia).
On June 19, 2007, Liu entered into and closed a Stock Purchase Agreement
with PNC Labs, Inc. ("PNC") to transfer 18,279,608 shares of common stock in the
Company to PNC at a consideration of $350,000 through a payment schedule
beginning June 19, 2007 and ending July 31, 2008. A change of control of the
Company occurred upon closing.
On June 26, 2007, Mr. Chun Ka Tsun resigned as the Company's Chief
Executive Officer and as a member of the Company's Board of Directors. Also on
June 26, 2007, Mr. Woo Chi Wai resigned as a member of the Company's Board of
Directors.
Also on June 26, 2007, Mr. Alan Lew was appointed as the new Chief
Executive Officer of the Company, and as a member of the Company's Board of
Directors.
BUSINESS OVERVIEW
Through our wholly owned subsidiary Eastbay, we owned 70% of PT Borneo that
owns a right of concession on coal mines on a total area of 19,191 hectares in
the territory of East Kalimantan of the Republic of Indonesia.
PRODUCTION FACILITIES
Through PT Borneo we own a right of concession on coal mines on a total
area of 19,191 hectares in the territory of East Kalimantan of the Republic of
Indonesia. The construction of the production facilities of PT Borneo was not
completed and as of December 31, 2006 and as of the date of this report, PT
Borneo does not commence into mining operations in Indonesia.
OUR PRODUCTS
Since PT Borneo did not commence any operations as of December 31, 2007 and
as of the date of this report, we did not offer any products to our customers
through PT Borneo.
TARGET MARKETS
As of December 31, 2007 and as of the date of this report, PT Borneo did
not commence into any operations. However, should PT Borneo commence mining
operations, coal produced by PT Borneo will be exported from Indonesia to South
East Asia and southern China.
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COMPETITION
The competitive environment in Indonesia for coal mining is spread between
large major coal exporters such as BP and Royal Tinto and many smaller locally
owned enterprises. BP and Royal Tinto are well capitalized to build out their
operations. The smaller coal minors are constantly looking for funding to expand
operations. Add Indonesia
PRINCIPAL OFFICE
Our headquarters is located at 1325 Airmotive #175, Reno, NV, 89502.
EMPLOYEES AND ORGANIZATION
Currently we have a total of 3 employees as follows:
Company Position Number
--------------- ---------------- ------
NT Holding Corp President 1
PT Borneo : General Manager 1
Business Manager 1
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TOTAL 3
======
The President of NTHH received no compensation from us during 2006 and
2007. We currently have an agreement for compensation of our chief executive,
and have no stock option plan or other equity compensation plan for our
directors and officers.
Also, the General Manager and the Business Manger of PT Borneo received no
compensation from PT Borneo and NTHH.
PATENTS AND INTELLECTUAL PROPERTIES
Through PT Borneo, we own a right of concession on coal mines on a total
area of 19,191 hectares in the territory of East Kalimantan of the Republic of
Indonesia. However, this is neither a patent nor an intellectual property and
no monetary value was attached to this mining right in our balance sheets as of
December 31, 2007.
GOVERNMENT REGULATIONS
Since PT Borneo did not commence operations as of December 31, 2007, we are
not subject to any Indonesia government regulations in the year of 2007.
BUSINESS DEVELOPMENT
In 2008 we will continue with our construction on the production facilities
of PT Borneo.
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ITEM 2 DESCRIPTION OF PROPERTIES
Through PT Borneo we own a right of concession on coal mines in a total
area of 19,191 hectares in the territory of East Kalimantan of the Republic of
Indonesia.
ITEM 3 LEGAL PROCEEDINGS
We are currently not involved in any litigation that we believe could have
a material adverse effect on our financial condition or results of operations.
There is no action, suit, proceeding, inquiry or investigation before or by any
court, public board, government agency, self-regulatory organization or body
pending or, to the knowledge of the executive officers of our company or any of
our subsidiaries, threatened against or affecting our company, our common stock,
any of our subsidiaries or of our Company's or our Company's subsidiaries'
officers or directors in their capacities as such, in which an adverse decision
could have a material adverse effect.
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to the security holders for a vote during the
period covered by this report.
PART II
ITEM 5 MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our common stock was quoted on the Over-the-Counter Bulletin Board
("OTCBB") under the symbol "NTHH."
The aggregate market value of the voting and non-voting common equity held
by non-affiliates of NTHH, based upon the average bid and asked price of such
common equity on March 31, 2008 as reported by the OTC BB, was approximately
$__. This number excludes shares of common stock held by each officer and
director of our Company and by each person who owns 5% or more of the
outstanding common stock, as these persons may be deemed to be affiliates. This
determination of affiliate status is not necessarily a conclusive determination
for other purposes.
Trading in our common stock has been limited and sporadic. The following
table shows the range of high and low bid quotations reported by the OTCBB in
each fiscal quarter from January 1, 2006 to March 31, 2008, and the subsequent
interim period. The OTCBB quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission, and may not represent actual transactions. As
of March 31, 2008, there were approximately 480 holders of record of our common
stock. This number does not include an indeterminate number of shareholders
whose shares are held by brokers in street name.
BID PRICES FOR THE REPORTING PERIOD
-----------------------------------
Year Period High Low
----- -------------- ---- ----
2005 First Quarter 0.60 0.60
Second Quarter 1.30 0.25
Third Quarter 0.88 0.20
Fourth Quarter 0.75 0.26
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2006 First Quarter 1.19 0.21
Second Quarter 2.10 1.05
Third Quarter 2.42 0.45
Fourth Quarter 0.74 0.19
2007 First Quarter 0.40 0.13
Second Quarter 0.07 0.04
Third Quarter 0.15 0.04
Fourth Quarter 0.07 0.03
DIVIDENDS
We presently intend to retain future earnings, if any, to provide funds for
use in the operation and expansion of our business. Accordingly, we have not
declared or paid any dividends to our common shareholders and do not presently
intend to do so. Any future decision whether to pay dividends will depend on our
financial condition and any other factors that our Board of Directors deems
relevant.
RECENT SALES OF UNREGISTERED SECURITIES
There have been no sales of unregistered securities during the period
covered by this report.
ITEM 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
This report contains forward-looking statements within the meaning of the
federal securities laws. These include statements about our expectations,
beliefs, intentions or strategies for the future, which we indicate by words or
phrases such as "anticipate," "expect," "intend," "plan," "will," "we believe,"
"NTHH believes," "management believes" and similar language. The forward-looking
statements are based on the current expectations of NTHH and are subject to
certain risks, uncertainties and assumptions, including those set forth in the
discussion under "Description of Business" and "Management's Discussion and
Analysis or Plan of Operation". The actual results may differ materially from
results anticipated in these forward-looking statements. We base the
forward-looking statements on information currently available to us, and we
assume no obligation to update them.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
NTHH's financial statements and related public financial information are
based on the application of accounting principles generally accepted in the
United States ("US GAAP"). US GAAP requires the use of estimates; assumptions,
judgments and subjective interpretations of accounting principles that have an
impact on the assets, liabilities, revenues and expenses amounts reported. These
estimates can also affect supplemental information contained in our external
disclosures including information regarding contingencies, risk and financial
condition. We believe our use of estimates and underlying accounting assumptions
adhere to GAAP and are consistently and conservatively applied. We base our
estimates on historical experience and on various other assumptions that we
believe to be reasonable under the circumstances. Actual results may differ
materially from these estimates under different assumptions or conditions. We
continue to monitor significant estimates made during the preparation of our
financial statements.
9
Our significant accounting policies are summarized in Note 1 to our
financial statements. While all these significant accounting policies impact its
financial condition and results of operations, NTHH views certain of these
policies as critical. Policies determined to be critical are those policies that
have the most significant impact on NTHH's consolidated financial statements and
require management to use a greater degree of judgment and estimates. Actual
results may differ from those estimates. Our management believes that given
current facts and circumstances, it is unlikely that applying any other
reasonable judgments or estimate methodologies would cause an adverse effect on
our consolidated results of operations, financial position or liquidity for the
periods presented in this report.
Revenues and cost of sales
Our revenue decreased from $9,891,094 for the year ended December 31, 2006
to $0 for the year ended December 31, 2007. The decrease is attributable to
sale of Perfect Growth Venture Corp. to a third party as described more fully in
Note 15 to these financial statements. Cost of sales decreased also from
$11,018,284 for year ended December 31, 2006 to $0 for the year ended December
31, 2007.
During 2007 we incurred a gross loss of $267,585 from our operations.
Operating expenses
For the year ended December 31, 2007 we did not incur any selling and
distribution expenses to support our operations. Compared to the year ended
December 31, 2006, our selling and distribution expenses decreased by $18,434 or
100%. Such decrease is attributable to sale of Perfect Growth Venture Corp. to
a third party as described more fully in Note 15 to these financial statements.
We incurred a total of $267,585 general and administrative expenses for the
year ended December 31, 2007 as compared to $705,910 for the year ended December
31, 2006. The general and administrative expenses of 2006 were mainly
attributable to new administrative overhead as a result of Jinhai acquisition
during 2006 and the Company did not have those expenses in 2007.
LOSS BEFORE MINORITY INTEREST
In 2007 we reported a net income of $132,432, as compared to a net loss of
$641,843 for the year ended December 31, 2006.
DISCONTINUED OPERATIONS
For the year ended December 31, 2007 we recorded an income from
discontinued operations in the amount of $400,017. This included a loss from
discontinued operations of $204,813 and a gain on disposal of discontinued
operations amounted to $604,830.
COMPREHENSIVE GAIN
In 2007 we incurred a comprehensive gain of $132,432, a reduction of a loss
of $450,652 from 2006. Our reduction in comprehensive loss in 2007 against 2006
is mainly due to:
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LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2007 our cash balance amounted to $0
From time to time we may require extra funding through financing activities
and investments to expand the operations of PT Borneo. Funding is required for
construction of facilities for PT Borneo. Also, from time to time, we may come
up with new expansion opportunities of which our management may consider seeking
external funding and financing. As of December 31, 2007 and date of this
report, we did not have any plan for additional funding.
NEW ACCOUNTING PRONOUNCEMENTS
The implementations of the above pronouncements are not expected to have a
significant effect on our consolidated financial statement presentation or
disclosure.
INFLATION
Inflation has not had a material impact on our business.
RISK FACTORS
Our business, financial condition, operating results and prospects are
subject to the following risks. Additional risks and uncertainties not
presently foreseeable to us may also impair our business operations. If any of
the following risks actually occurs, our business, financial condition or
operating results could be materially adversely affected. In such case, the
trading price of our common stock could decline, and our stockholders may lose
all or part of their investment in the shares of our common stock.
Risks Relating to Our Company
- -----------------------------
WE CANNOT ASSURE YOU THAT OUR GROWTH STRATEGY WILL BE SUCCESSFUL.
One of our growth strategies in PT Borneo's operations is to grow through
proving out the coal reserves of PT Borneo. However, many obstacles to entering
such new markets exist, including, but not limited to, international trade and
tariff barriers, shipping and delivery costs, costs associated with marketing
efforts abroad and maintaining attractive foreign exchange ratios. We cannot,
therefore, assure you that we will be able to successfully overcome such
obstacles and establish our products in any additional markets. Our inability
to implement this organic growth strategy successfully may have a negative
impact on our ability to grow and on our future financial condition, results of
operations or cash flows.
WE CANNOT ASSURE YOU THAT OUR ACQUISITION GROWTH STRATEGY WILL BE SUCCESSFUL.
In addition to our organic growth strategy for PT Borneo, we also expect to grow
through strategic acquisitions. We intend to pursue opportunities to acquire
businesses that are complementary or related to energy and natural resources.
We may not be able to locate suitable acquisition candidates at prices that we
consider appropriate or to finance acquisitions on terms that are satisfactory
to us. If we do identify an appropriate acquisition candidate, we may not be
able to negotiate successfully the terms of an acquisition, finance the
acquisition or, if the acquisition occurs, integrate the acquired business into
our existing business. Acquisitions of businesses or other material operations
may require debt financing or additional equity
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financing, resulting in leverage or dilution of ownership. We also may not be
able to maintain key employees or customers of an acquired business or realize
cost efficiencies or synergies or other benefits we anticipated when selecting
our acquisition candidates. In addition, we may need to record write-downs from
future impairments of intangible assets, which could reduce our future reported
earnings. At times, acquisition candidates may have liabilities or adverse
operating issues that we fail to discover through due diligence prior to the
acquisition.
IF WE ARE NOT ABLE TO IMPLEMENT OUR STRATEGIES IN ACHIEVING OUR BUSINESS
OBJECTIVES, OUR BUSINESS OPERATIONS AND FINANCIAL PERFORMANCE MAY BE ADVERSELY
AFFECTED.
Our business plan is based on circumstances currently prevailing and the bases
and assumptions that certain circumstances will or will not occur, as well as
the inherent risks and uncertainties involved in various stages of development.
However, there is no assurance that we will be successful in implementing our
strategies or that our strategies, even if implemented, will lead to the
successful achievement of our objectives. If we are not able to successfully
implement our strategies, our business operations and financial performance may
be adversely affected.
THE TYPE OF BUSINESS THAT MAY BE ACQUIRED IS NOT IDENTIFIED
Our investors and stockholders have to rely on our management to determine
which target business to pursue. There are no controlling parameters of the
business to be acquired. Thus, ultimately an investment will depend on the
target business and therefore investors in us will be subject to all the risks
that would be associated with that selected business. Our management may have
the right to approve and authorize a reverse merger transaction with a target
company without obtaining the vote of the majority of our stockholders.
INTENSE COMPETITION FROM EXISTING AND NEW ENTITIES MAY ADVERSELY AFFECT OUR
REVENUES AND PROFITABILITY.
Our subsidiary, PT Borneo, competes with other companies, many of whom are
developing or can be expected to develop products similar to ours. Although our
market is a large market with limited competitors, many of our competitors are
more established than we are, and have significantly greater financial,
technical, marketing and other resources than we presently possess. Some of our
competitors have greater name recognition and a larger customer base. These
competitors may be able to respond more quickly to new or changing opportunities
and customer requirements and may be able to undertake more extensive
promotional activities, offer more attractive terms to customers, and adopt more
aggressive pricing policies. We cannot assure you that we will be able to
compete effectively with current or future competitors or that the competitive
pressures we face will not harm our business.
THE PRODUCTS AND THE PROCESSES WE USE COULD EXPOSE US TO SUBSTANTIAL LIABILITY.
In our PT Borneo subsidiary, once we commence into operations, we face an
inherent business risk of exposure to drilling, exploration and processing of
coal and related products. To date, we have not experienced any accidents,
claims and liabilities arisen from drilling, exploration and processing of coal
and related products. However, that does not mean that we will not have any such
accidents, claims and liabilities in the future.
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WE MAY NEVER PAY ANY DIVIDENDS TO OUR SHAREHOLDERS.
We did not declare any dividends for the year ended December 31, 2007. Our board
of directors does not intend to distribute dividends in the near future. The
declaration, payment and amount of any future dividends will be made at the
discretion of the board of directors, and will depend upon, among other things,
the results of our operations, cash flows and financial condition, operating and
capital requirements, and other factors that the board of directors considers
relevant. There is no assurance that future dividends will be paid, and if
dividends are paid, there is no assurance with respect to the amount of any such
dividend.
OUR OPERATIONS REQUIRE US TO COMPLY WITH A NUMBER OF U.S. AND INTERNATIONAL
REGULATIONS.
We need to comply with a number of international regulations in countries
outside of the United States. In addition, we must comply with the Foreign
Corrupt Practices Act, or FCPA, which prohibits U.S. companies or their agents
and employees from providing anything of value to a foreign official for the
purposes of influencing any act or decision of these individuals in their
official capacity to help obtain or retain business, direct business to any
person or corporate entity or obtain any unfair advantage. Any failure by us to
adopt appropriate compliance procedures and ensure that our employees and agents
comply with the FCPA and applicable laws and regulations in foreign
jurisdictions could result in substantial penalties and/or restrictions in our
ability to conduct business in certain foreign jurisdictions. The U.S.
Department of The Treasury's Office of Foreign Asset Control, or OFAC,
administers and enforces economic and trade sanctions against targeted foreign
countries, entities and individuals based on U.S. foreign policy and national
security goals. As a result, we are restricted from entering into transactions
with certain targeted foreign countries, entities and individuals except as
permitted by OFAC, which may reduce our future growth.
WE MAY INCUR SIGNIFICANT COSTS TO ENSURE COMPLIANCE WITH U.S. CORPORATE
GOVERNANCE AND ACCOUNTING REQUIREMENTS.
We may incur significant costs associated with our public company reporting
requirements, costs associated with newly applicable corporate governance
requirements, including requirements under the Sarbanes-Oxley Act of 2002 and
other rules implemented by the Securities and Exchange Commission and the
American Stock Exchange. We expect all of these applicable rules and
regulations to increase our legal and financial compliance costs and to make
some activities more time-consuming and costly. We also expect that these
applicable rules and regulations may make it more difficult and more expensive
for us to obtain director and officer liability insurance and we may be required
to accept reduced policy limits and coverage or incur substantially higher costs
to obtain the same or similar coverage. As a result, it may be more difficult
for us to attract and retain qualified individuals to serve on our board of
directors or as executive officers. We are currently evaluating and monitoring
developments with respect to these newly applicable rules, and we cannot predict
or estimate the amount of additional costs we may incur or the timing of such
costs.
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WE MAY BE REQUIRED TO RAISE ADDITIONAL FINANCING BY ISSUING NEW SECURITIES WITH
TERMS OR RIGHTS SUPERIOR TO THOSE OF OUR SHARES OF COMMON STOCK, WHICH COULD
ADVERSELY AFFECT THE MARKET PRICE OF OUR SHARES OF COMMON STOCK.
We may require additional financing to fund future operations, including
expansion in current and new markets as well as acquisition. Because of the
early stage of development of our operations and exposure to market risks
associated with economies in emerging markets, we may not be able to obtain
financing on favorable terms or at all. If we raise additional funds by issuing
equity securities, the percentage ownership of our current shareholders will be
reduced, and the holders of the new equity securities may have rights superior
to those of the holders of shares of common stock, which could adversely affect
the market price and the voting power of shares of our common stock. If we raise
additional funds by issuing debt securities, the holders of these debt
securities would similarly have some rights senior to those of the holders of
shares of common stock, and the terms of these debt securities could impose
restrictions on operations and create a significant interest expense for us.
WE MAY HAVE DIFFICULTY RAISING NECESSARY CAPITAL TO FUND OPERATIONS AS A RESULT
OF MARKET PRICE VOLATILITY FOR OUR SHARES OF COMMON STOCK.
In recent years, the securities markets in the United States have experienced a
high level of price and volume volatility, and the market price of securities of
many companies have experienced wide fluctuations that have not necessarily been
related to the operations, performances, underlying asset values or prospects of
such companies. For these reasons, our shares of common stock can also be
expected to be subject to volatility resulting from purely market forces over
which we will have no control. If our business development plans are successful,
we may require additional financing to continue to develop and exploit existing
and new technologies and to expand into new markets. The exploitation of our
technologies may, therefore, be dependent upon our ability to obtain financing
through debt and equity or other means.
IMPRACTICABILITY OF EXHAUSTIVE INVESTIGATION
We have limited funds and lack full-time management, which will likely make
it impracticable to conduct a complete and exhaustive investigation and analysis
of a business opportunity before we commit our limited capital and other
resources to acquire a target business. Management decisions, therefore, likely
will be made without detailed feasibility studies, independent analysis, market
surveys, and the like which, if we had more funds available to us, would be
desirable. We will be particularly dependent in making decisions upon
information provided by owner or finders associated with the business
opportunity seeking to be acquired by us.
LACK OF DIVERSIFICATION
Because of our limited financial resources, it is unlikely that we will be
able to diversify our acquisitions or operations. The inability to diversify our
activities into more than one area will subject our investors and stockholders
to economic fluctuations within a particular business or industry and therefore
increase the risks associated with the investment.
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POSSIBLE RELIANCE UPON UNAUDITED FINANCIAL STATEMENTS
We will require audited financial statements from target companies that we
propose to acquire. No assurance can be given, however, that audited financials
will be available at the closing of the any acquisition transaction. In cases
where audited financials are unavailable, we will have to rely upon unaudited
information received from target companies' management that has not been
verified by outside auditors.
WE MIGHT NEED TO COMPLY WITH OTHER REGULATIONS DURING FOR BUSINESS EXPANSION
THROUGH ACQUISITIONS.
Any acquisition made by us may be of a business that is subject to
regulation or licensing by federal, state, or local authorities. Foreign
companies may also be considered, and be subject to similar business regulations
as are applicable in the United States and also may be subject to limitations on
ownership by foreign persons and entities. Compliance with such regulations and
licensing can be expected to be a time-consuming, expensive process and may
limit our other investment opportunities. We intend to pursue potential business
opportunities in foreign countries, including China, and as such, such
opportunities will be subject to foreign country laws and regulations affecting
foreign investment, business operations, currency exchange, repatriation of
profits, and taxation, which will increase the risk of your investment.
THINLY-TRADED PUBLIC MARKET
Our securities will be very thinly traded, and the price if traded may not
reflect the value of our Company. There can be no assurance that there will be
an active market for our shares. The market liquidity will be dependant on the
perception of the operating business and any steps that its management might
take to bring the Company to the awareness of investors. There can be no
assurance given that there will be any awareness generated. Consequently
investors may not be able to liquidate their investment or liquidate it at a
price that reflects the value of the business. If a more active market should
develop, the price may be highly volatile. Because there may be a low price for
our securities, many brokerage firms may not be willing to effect transactions
in the securities. Even if an investor finds a broker willing to effect a
transaction in the securities, the combination of brokerage commissions,
transfer fees, taxes, if any, and any other selling costs may exceed the selling
price. Further, many lending institutions will not permit the use of such
securities as collateral for any loans.
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ITEM 7 FINANCIAL STATEMENTS.
The following financial statements required by this item are filed herewith
following the signature page to this report:
Report of Independent Registered Public Accounting Firm F-1*
Balance Sheet as of December 31, 2007 F-2*
Statement of Operations for the period from May 27, 2005 F-3*
(Date of inception) to December 31, 2007
Statement of Stockholders' Equity for the period from F-4*
May 27, 2005 (Date of inception) to December 31, 2007
Statement of Cash Flows for the period from May 27, 2005 F-5*
(Date of inception) to December 31, 2007
Notes to Financial Statements F-7 to F-12*
* Filed with the Company's Annual Report on Form 10-K for the Year Ended
December 31, 2007, and incorporated herein by this reference.
ITEM 8 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
As approved by our Board of Directors, on March 19, 2007, the accounting
firm of Madsen & Associates CPAs, Inc. was retained by the Company; and the
Company's previous auditor, Child, Van Wagoner & Bradshaw, PLLC, was dismissed
on that same date. Child, Van Wagoner & Bradshaw, P.L.L.C. had been appointed
on February 24, 2006 as our independent auditor.
Our board approved to reengage Madsen to take over the audit
responsibilities from Child, Van Wagoner & Bradshaw, P.L.L.C. and Child, Van
Wagoner & Bradshaw, P.L.L.C. was dismissed on that same date. Since the
engagement of Child, Van Wagoner & Bradshaw, P.L.L.C. on February 24, 2006, we
have not consulted with Madsen, or any other auditor, regarding any accounting
or audit concerns, to include, but not by way of limitation, those stated in
Item 304(a)(2) of Regulation S-B.
During our two most recent fiscal years and the subsequent interim period
through the date of dismissal, we have not had any disagreements with our former
or current accountants, whether resolved or not resolved, on any matter of
accounting principals or practices, financial statement disclosure, or auditing
scope or procedure, which, if not resolved to said accountants' satisfaction,
would have caused it to make reference to the subject matter of the
disagreements(s) in connection with its report.
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ITEM 8(A)T. CONTROLS AND PROCEDURES.
- ------------------------------------
Under the supervision and with the participation of our management, including
our chief executive officer, we evaluated the effectiveness of the design and
operation of our disclosure controls and procedures (as defined in Rule
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange
Act")) as of the end of the period covered by this report. Based upon that
evaluation, our chief executive officer concluded that our disclosure controls
and procedures as of the end of the period covered by this report were not
effective such that the information required to be disclosed by us in reports
filed under the Securities Exchange Act of 1934 is (i) recorded, processed,
summarized and reported within the time periods specified in the SEC's rules and
forms and (ii) accumulated and communicated to our management, including our
Chief Executive Officer, as appropriate to allow timely decisions regarding
disclosure. A discussion of the material weaknesses in our controls and
procedures is described below.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING.
Our management, which consists primarily of Alan Lew, president and chief
accounting officer, who is responsible for establishing and maintaining adequate
internal control over financial reporting (as defined in Rule 13a-15(f) under
the Exchange Act). Our internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes of
accounting principles generally accepted in the United States.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Therefore, even those systems
determined to be effective can provide only reasonable assurance of achieving
their control objectives.
Our management, including our sole executive and accounting officer, evaluated
the effectiveness of the Company's internal control over financial reporting as
of December 31, 2007. In making this assessment, our management used the COSO
framework, an integrated framework for the evaluation of internal controls
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based on its evaluation, our management concluded that there are multiple
material weaknesses in our internal control over financial reporting. A
material weakness is a deficiency, or combination of control deficiencies, in
internal control over financial reporting such that there is a reasonable
possibility that a material misstatement of the Company's annual or interim
financial statements will not be prevented or detected on a timely basis.
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The material weaknesses identified are primarily due to insufficient personnel
in the finance department which results in an inability to provide effective
oversight and review of financial transactions with regard to accumulating and
compiling financial data in the preparation of financial statements. The lack
of sufficient personnel also results in a lack of segregation of duties and the
accounting technical expertise necessary for an effective system of internal
control.
We have begun to take steps to mitigate this material weakness to the fullest
extent possible. As soon as our finances allow, we plan on hiring additional
finance staff and, where necessary, utilizing competent outside consultants to
provide a layer of review and technical expertise that is currently lacking in
our internal controls over financial reporting.
Based on our evaluation under the frameworks described above, our management has
concluded that our internal control over financial reporting was not effective
as of December 31, 2007.
This annual report does not include an attestation report of the company's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the company's
registered public accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit the company to provide only management's
report in this annual report.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING.
During the most recent quarter ended December 31, 2007, there was no change in
our internal control over financial reporting (as defined in Rule 13a-15(f) and
15d-15(f) under the Exchange Act) ) that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.
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CHANGES IN INTERNAL CONTROLS
Our Certifying Officers have indicated that there were no significant
changes in our internal controls or other factors that could significantly
affect such controls subsequent to the date of their evaluation, and there were
no such control actions with regard to significant deficiencies and material
weaknesses.
SARBANES - OXLEY ACT 404 COMPLIANCE
The Company anticipates that it will be fully compliant with section 404 of
the Sarbanes-Oxley Act of 2002 by the required date for non-accelerated filers
and it is in the process of reviewing its internal control systems in order to
be compliant with Section 404 of the Sarbanes Oxley Act. However, at this time
the Company makes no representation that its systems of internal control comply
with Section 404 of the Sarbanes-Oxley Act.
PART III
ITEM 9 DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The table below sets forth the names and ages of our current directors and
executive officers, their principal offices and positions and the date each such
person became a director or executive officer of our Company. Our executive
officers are appointed annually by the Board of Directors. Our directors serve
one year terms until their successors are elected. The executive officers serve
terms of one year or until their death, resignation or removal by the Board of
Directors. There are no family relationships between any of the directors and
executive officers. In addition, there were no arrangements or understanding
between any executive officer and any other person pursuant to which any person
was selected as an executive officer. Currently, directors are not compensated
for serving on the Board of Directors. We have not established compensation or
executive committees. Currently, our entire board of directors serves as our
audit committee. Because of the small size of the Company and the risk attendant
to a small public company, we are currently unable to attract an audit committee
financial expert to our Board of Directors.
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RESIGNATION AND APPOINTMENT OF DIRECTOR
On June 26, 2007, Mr. Chun Ka Tsun resigned as the Company's Chief
Executive Officer and as a member of the Company's Board of Directors. Also on
June 26, 2007, Mr. Woo Chi Wai resigned as a member of the Company's Board of
Directors. That same day, Mr. Alan Lew was appointed as the new Chief Executive
Officer of the Company, and as a member of the Company's Board of Directors.
Mr. Alan Lew, age 33, is currently the President and Secretary of PNC Labs,
Inc., which was previously a subsidiary of the Company during which time Mr. Lew
served as President of the Company and as a member of the Company's Board of
Directors. PNC Labs researches, develops and markets nutraceutical products. Mr.
Lew has vast experience and contacts in the biotechnology industry. He was most
recently a clinical site manage for Pfizer, Inc., where his responsibilities
included monitoring and locating new physicians for investigative trials. Mr.
Lew has also worked for Sloan-Kettering Hospital in New York City, and for
Acorda Therapeutics.
FAMILY RELATIONSHIPS
There are no family relationships between any of directors or executive
officers or any other director or executive officer.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The articles of incorporation of the Company limit the liability of
directors to the maximum extent permitted by Nevada law. This limitation of
liability is subject to exceptions including intentional misconduct, obtaining
an improper personal benefit and abdication or reckless disregard of director
duties. The articles of incorporation and bylaws of the Company provide that we
may indemnify its directors, officer, employees and other agents to the fullest
extent permitted by law. The bylaws also permit us to secure insurance on
behalf of any officer, director, employee or other agent for any liability
arising out of his or her actions in such capacity, regardless of whether the
bylaws would permit indemnification. We currently do not have such an insurance
policy.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted for our directors, officers and controlling 1934
persons pursuant to the foregoing provisions, or otherwise, The Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
CODE OF ETHICS
The Company has adopted a code of ethics, which is incorporated by
reference.
ITEM 10 EXECUTIVE COMPENSATION
Our executive and director received no compensation from the Company for
the years ended December 31, 2006 and December 31, 2007. We currently have an
agreement for compensation of our President, and have no stock option plan or
other equity compensation plan for our employees.
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ITEM 11 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND ANAGEMENT
Mr. Alan Lew, age 33, is currently the President and Secretary of NT
Holding Corp. Mr.Lew is also President of PNC Labs, Inc., our majority
shareholder. Mr. Lew has vast experience and contacts in the biotechnology
industry. Mr. Lew has worked for Sloan-Kettering Hospital in New York City,
Pfizer, and other biotech companies.
The following table sets forth certain information regarding beneficial
ownership of common stock as of March 31, 2008 by each person known to us to
own beneficially more than 5% of our common stock, each of our directors, each
of our named executive officers; and all executive officers and directors as a
group.
Name Position Held Shares Owned % Owned
Alan Lew President 134,079 less than 1%
PNC LABS, INC. 19,433,040 75.21%
ITEM 12 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
NIL
ITEM 13 EXHIBITS
The following exhibits are included as part of this report:
14. Code of Ethics (1)
31.1 Sarbanes Oxley Section 302 Certification of Chief Executive Officer
31.2 Sarbanes Oxley Section 302 Certification of Chief Financial Officer
32.1 Sarbanes Oxley Section 906 Certification of Chief Executive Officer(2)
32.2 Sarbanes Oxley Section 906 Certification of Chief Financial Officer(2)
________
(1) incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended December 31, 2005.
(2) incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended December 31, 2007.
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ITEM 14 PRINCIPAL ACCOUNTANT FEES AND SERVICES
AUDIT FEES
For the year ended December 31, 2007 We paid our fees for our audit for the
year ended December 31, 2007 in 2008.
We do not currently have an audit committee of the Board of Directors and
the full Board of Directors did not pass on whether any non-audit services
impacted our auditor's independence. We currently do not have any policy for
approval of audit and permitted non-audit services by our independent auditor.
We plan to appoint an audit committee of our Board of Directors and adopt
procedures for approval of audit and non-audit services.
ALL OTHER FEES
None
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SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: October 6, 2008
NT HOLDING CORP.
By:/s/ Alan Lew
------------
Alan Lew
Former Chief Executive Officer and Chairman
By: /s/Alan Lew
-------------
Alan Lew
Former Chief Financial Officer
In accordance with the Exchange Act, this report has been signed below by the
following person on behalf of the registrant and in the capacities and on the
dates indicated.
Date: October 6, 2008
/s/ Alan Lew
------------
Alan Lew
Former Director
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