UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2010
Commission File Number 000-52758
RainEarth Inc.
(formerly GoldRock Resources, Inc.)
(Name of small business issuer in its charter)
Nevada (State or Other Jurisdiction of Organization)
N/A
(IRS Employer Identification No.)
A No.1 Building, ShangDu International Tower,
No.8 DongDaQiao Road, Beijing,
China 100020
(Address of principal executive offices, including zip code)
(852) 3005-7220
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the registrant is an accelerated filer
(as defined in Rule 12 b - 2 of the Exchange Act)
Yes No (x)
Indicate by check mark whether the registrant (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.
Yes [X] No [ ]
The Registrant is a Shell company. Yes [X] No [ ]
As of March 15, 2010, the Company has 52,000,000 shares of common
stock issued and outstanding.
1
RainEarth Inc.
Form 10-Q for the period ended January 31, 2010
TABLE OF CONTENTS
Page
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS (Unaudited) 3
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Consolidated Financial Statements 6-11
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 12-17
ITEM 3 -QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK 17
ITEM 4 - CONTROLS AND PROCEDURES 17
ITEM 4A - INTERNAL CONTROL OVER FINANCIAL REPORTING 17
PART II - OTHER INFORMATION
ITEM 1- LEGAL PROCEEDINGS 18
ITEM 1A - RISK FACTORS 18
ITEM 2- UNREGISTERED SALES OF EQUITY SECURITIES
AND USE OF PROCEEDS 18
ITEM 3- DEFAULTS UPON SENIOR SECURITIES 18
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 18
ITEM 5 - OTHER INFORMATION 18
ITEM 6- EXHIBITS 19
SIGNATURES 20-25
2
PART I. - FINANCIAL INFORMATION
ITEM 1. INTERIM FINANCIAL STATEMENTS.
RainEarth Inc. (formerly Gold Rock Resources Inc.)
(A Development Stage Company)
Balance Sheets
(Expressed in US Dollars)
Jan 31, April 30,
2010 2009
(Unaudited)
ASSETS
Current Assets
Cash $ 13,182 $ 52,470
_______________________
Total Current Assets 13,182 52,470
Investment in Beijing RainEarth
Technology Co. Ltd ("Beijing RainEarth"),
less accumulated amortization of $27,441
and $3,244 respectively 612,559 636,756
_______________________
Total Assets $ 625,741 $ 689,226
_______________________
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued liabilities $ 26,547 $ 13,847
Due to related party 45,021 45,021
_______________________
Total current liabilities 71,568 58,868
_______________________
Stockholders' Equity
Preferred stock, $0.00001 par value
Authorized 1,000,000,000 shares
Issued and outstanding, none issued - -
Common stock, $0.00001 par value
Authorized 1,000,000,000 shares
Issued and outstanding, 52,000,000 and
52,000,000 shares, respectively 520 520
Additional paid-in capital 774365 767,615
Accumulated deficit (220,712) (137,777)
_______________________
Total stockholders' equity 554,173 630,358
_______________________
Total Liabilities and Stockholders' Equity $ 625,741 $ 689,226
_______________________
The accompanying notes are an integral part of these financial statements
3
RainEarth Inc. (formerly Gold Rock Resources Inc.)
(A Development Stage Company)
Statements of Operations
(Expressed in US Dollars)
(Unaudited)
Cumulative
during the
development
stage
(March 14,
For the 3 months For the 9 months 2006 to
ended Jan 31 ended Jan 31 Jan 31)
2010 2009 2010 2009 2010
Revenue $ - - - - -
Expenses
Donated rent 750 750 2,250 2,250 11,625
Donated services 1,500 1,500 4,500 4,500 23,250
General and
administrative 84 721 419 1,565 46,467
Impairment of mineral
claim acquisition costs - - - - 3,062
Professional fees 5,316 3,068 51,569 29,890 108,866
Amortization of
investment in
Beijing RainEarth 8,066 - 24,197 - 27,442
________________________________________________
Total Cost and
Expenses 15,716 6,039 82,935 38,205 220,712
________________________________________________
Net Loss $ (15,716) (6,039) (82,935) (38,205) (220,712)
________________________________________________
Net Loss per share
Basic and diluted $ (0.00) (0.00) (0.00) (0.00)
Number of common shares
used to compute loss
per share
Basic and diluted 52,000,000 52,000,000 52,000,000 52,000,000
The accompanying notes are an integral part of these financial statements
4
RainEarth Inc. (formerly Gold Rock Resources Inc.)
(A Development Stage Company)
Statements of Cash Flows
(Expressed in US Dollars)
(Unaudited)
Cumulative
during the
development
stage
(March 14,
9 months ended 2006 to
January 31, Jan 31)
2010 2009 2010
Cash Flows from Operating Activities
Net loss $ (82,935) $ (38,205) $ (220,712)
Adjustments to reconcile net
loss to net
cash used for operating activities:
Impairment of mineral claim
acquisition costs - - 3,062
Donated services 4,500 4,500 23,250
Donated rent 2,250 2,250 11,625
Amortization of investment in
Beijing RainEarth 24,197 - 27,442
Changes in operating assets
and liabilities
Accounts payable and accrued
liabilities 12,700 439 26,547
__________________________________
Net cash provided by (used for)
operating activities (39,288) (31,016) (128,786)
__________________________________
Cash Flows from Investing Activities
Mineral claim acquisition
costs incurred - - (3,062)
__________________________________
Net cash provided by (used for)
investing activities - - (3,062)
__________________________________
Cash Flows from Financing Activities
Loans from related party - - 45,021
Proceeds from sales of common stock - - 100,010
__________________________________
Net cash provided by (used for)
financing activities - - 145,031
__________________________________
Increase (decrease) in cash (39,288) (31,016) 13,183
Cash, beginning of period 52,470 94,028 -
__________________________________
Cash, end of period $ 13,182 63,012 13,183
__________________________________
Supplemental disclosures of cash flow information:
Interest paid $ - - -
Income taxes paid $ - - -
Non-Cash investing and financing activities:
Issuance of common stock in
connection with investment in
Beijing RainEarth $ 640,000 - 640,000
The accompanying notes are an integral part of these financial statements
5
RainEarth Inc. (formerly Gold Rock Resources Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
January 31, 2010
(Unaudited)
Note 1.
Organization and Business Operations
RainEarth Inc. (the "Company") was incorporated in the State of
Nevada on March 14, 2006 under the name of Gold Rock Resources
Inc. In April 2006 (see Note 4), the Company acquired a mineral
claim in British Columbia, Canada; the claim was forfeited April
19, 2009. On March 25, 2009 (see Note 5), the Company entered into
a Business Cooperation Agreement with Beijing Rain Earth
Technology Co. Ltd. ("Beijing RainEarth") to jointly conduct a
Hollow Fiber Membrane Materials application and manufacturing
business. On March 27, 2009, the Company changed its name to
RainEarth Inc.
On July 11, 2008, the Company effected a 10 for 1 forward stock
split of its common stock, thereby increasing the number of issued
and outstanding common shares from 2,000,000 shares to 20,000,000
shares and the number of authorized common and preferred shares
from 100,000,000 shares to 1,000,000,000 shares. The financial
statements have been retroactively adjusted to reflect this stock
split.
The financial statements have been prepared on a going concern
basis, which implies the Company will continue to realize its
assets and discharge its liabilities in the normal course of
business. At January 31, 2010, the Company had cash of $13,182 and
negative working capital of $58,386. For the three and nine months
ended January 31, 2010 and 2009, the Company had net losses of
$15,716, $6,039, $82,935 and $38,205, respectively. These factors
raise substantial doubt as to the Company's ability to continue as
a going concern. The Company plans to raise additional capital and
achieve profitable operations through the Business Cooperation
Agreement with Beijing RainEarth. However, there is no assurance
that the Company will accomplish these objectives. The financial
statements do not include any adjustments to the recoverability
and classification of recorded asset amounts and classification of
liabilities that might be necessary should the Company be unable
to continue as a going concern.
6
Note 2.
Interim Financial Statements
The unaudited financial statements as of January 31, 2010 and for
the three and nine months ended January 31, 2010 and 2009 and for
the period March 14, 2006 (inception) to January 31, 2010 have
been prepared in accordance with accounting principles generally
accepted in the United States for interim financial information
and with instructions to Form 10-Q. In the opinion of management,
the unaudited financial statements have been prepared on the same
basis as the annual financial statements and reflect all
adjustments, which include only normal recurring adjustments,
necessary to present fairly the financial position as of January
31, 2010 and the results of operations and cash flows for the
three and nine months ended January 31, 2010 and 2009, and for the
period March 14, 2006 (inception) to January 31, 2010. The
financial data and other information disclosed in these notes to
the interim financial statements related to these periods are
unaudited. The results for the three and nine month period ended
January 31, 2010 is not necessarily indicative of the results to
be expected for any subsequent quarter of the entire year ending
April 30, 2010. The balance sheet at April 30, 2009 has been
derived from the audited financial statements at that date.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting
principles generally accepted in the United States have been
condensed or omitted pursuant to the Securities and Exchange
Commission's rules and regulations. These unaudited financial
statements should be read in conjunction with our audited
financial statements and notes thereto for the year ended April
30, 2009 as included in our report on Form 10-K filed June 22,
2009.
Note 3. Related Party Balances/Transactions
a) During the nine months ended January 31, 2010 and 2009, the
Company recognized a total of $4,500 for donated services at $500
per month and $1,500 for donated rent at $250 per month provided
by the President of the Company at no cost.
b) At January 31, 2010, the Company is indebted to a director of
the Company for $45,021, which is non-interest bearing, unsecured
and due on demand.
7
Note 4. Mineral Claim
In April 2006, the Company, through its former President and
director, acquired 100% of the rights, title and interest in a
mining claim representing 14 contiguous cells and covering an area
of 725 acres. The property is situated on the eastern-flank of
the Summers Creek Valley. It lies about the Rampart Lake road
approximately 11 miles due north of the Town of Princeton
(formerly known as Vermillion Forks), British Columbia, Canada.
Payment of $3,062 was required to record this mining claim and was
paid on April 7, 2006. The claim was registered in the name of the
former President of the Company, who agreed to hold the claim in
trust on behalf of the Company. On April 19, 2009, the claim was
forfeited due to non payment of renewal fees.
Note 5. Investment in Beijing RainEarth
The investment in Beijing RainEarth, net, consists of:
January 31,April 30, 2010 2009 Fair value of 32,000,000 shares of
RainEarth Inc.
Common Stock issued to designated party of Beijing RainEarth
pursuant to Business Cooperation Agreement dated March 25, 2009
$640,000 $640,000 Accumulated amortization
(27,441)(3,244)Net$612,559 $636,756 The $640,000 fair value of the
32,000,000 shares of RainEarth Inc. common stock was determined
using a $0.02 estimated price per share. No trades occurred in the
Company's shares of Common Stock from July 14, 2008 to April 2,
2009. On April 3, 2009, 2,500 shares traded at $0.55 per share and
on October 29, 2009, 27,000 shares traded at prices ranging from
$0.017 to $0.0175 per share.
The investment is being amortized using the straight line method
over the 20 years term of the Business Cooperation Agreement.
On March 25, 2009, the Company entered into a Business Cooperation
Agreement (the "Agreement") with Beijing RainEarth to jointly
conduct a Hollow Fiber Membrane Materials application and
manufacturing business. The Agreement provides for the Company to
provide marketing and consulting services to Beijing RainEarth and
to take actions to raise up to $20,000,000 for Beijing RainEarth.
The Agreement also provides for the payment of consulting services
fees to the Company equal to 60% of Beijing RainEarth's quarterly
revenues after deduction of direct operating costs, expenses and
taxes. The term of the Agreement is 20 years. Pursuant to the
Agreement, the Company issued 32,000,000 newly issued shares of
its Common Stock (representing approximately 61.5% of the
52,000,000 issued and outstanding shares after the issuance) to a
designated party of Beijing RainEarth.
8
Beijing RainEarth was incorporated in Beijing China in March 2006.
According to unaudited financial statements provided the Company,
Beijing RainEarth had assets of 4,165,486 Renminbi ("RMB")
(approximately $610,077), liabilities of 74,763 RMB (approximately
$10,950), and stockholders' equity of 4,090,723 RMB (approximately
$599,127) at January 31, 2010 and for the nine months ended
January 31, 2010, had sales of 5,700,000 RMB (approximately
$834,794) and a net loss of 425,592 RMB (approximately $62,330).
For the three and nine months ended January 31, 2010 and for the
period March 14, 2006 (inception) to January 31, 2010, the Company
did not receive or accrue any consulting services fees from
Beijing RainEarth.
Note 6. Preferred Stock - Terms and Conditions
The preferred stock may be divided into, and issued, in series.
The Board of Directors of the Company is authorized to divide the
authorized shares of preferred stock into one or more series, each
of which shall be so designated as to distinguish the shares
thereof from the shares of all other series and classes. The Board
of Directors of the Company is authorized, within any limitations
prescribed by law and this Article, to fix and determine the
designations, rights, qualifications, preferences, limitations and
terms of the shares of any series of preferred stock including but
not limited to the following:
a) The rate of dividend, the time of payment of dividends, whether
dividends are cumulative, and the date from which any dividends
shall accrue;
b) Whether shares may be redeemed, and, if so, the redemption
price and the terms and conditions of redemption;
c) The amount payable upon shares in the event of voluntary or
involuntary liquidation;
d) Sinking fund or other provisions, if any, for the redemption or
purchase of shares;
e) The terms and conditions on which shares may be converted, if
the shares of any series are issued with the privilege of
conversion;
9
f) Voting powers, if any, provided that if any of the preferred
stock or series thereof shall have voting rights, such preferred
stock or series shall vote only on a share for share basis with
the common stock on any matter, including but not limited to the
election of directors, for which such preferred stock or series
has such rights; and,
g) Subject to the foregoing, such other terms, qualifications,
privileges, limitations, options, restrictions, and special or
relative rights and preferences, if any, of shares or such series
as the Board of Directors of the Company may, at the time so
acting, lawfully fix and determine under the laws of the State of
Nevada.
The Company shall not declare, pay or set apart for payment any
dividend or other distribution (unless payable solely in shares of
common stock or other class of stock junior to the preferred stock
as to dividends or upon liquidation) in respect of common stock,
or other class of stock junior to the preferred stock, nor shall
it redeem, purchase or otherwise acquire for consideration shares
of any of the foregoing, unless dividends, if any, payable to
holders of preferred stock for the current period (and in the case
of cumulative dividends, if any, for all past periods) have been
paid, are being paid or have been set aside for payments. In the
event of the liquidation of the Company, holders of preferred
stock shall be entitled to receive, before any payment or
distribution on the common stock or any other class of stock
junior to the preferred stock upon liquidation, a distribution per
share in the amount of the liquidation preference, if any, fixed
or determined in accordance with the terms of such preferred stock
plus, if so provided in such terms, an amount per share equal to
accumulated and unpaid dividends in respect of such preferred
stock (whether or not earned or declared) to the date of such
distribution.
Neither the sale, lease or exchange of all or substantially all of
the property and assets of the Company, nor any consolidation or
merger of the Company, shall be deemed to be a liquidation for the
purposes of these terms and conditions.
Note 7. Public Offering
On February 1, 2007, the Securities and Exchange Commission
declared effective the Company's Form SB-2 Registration Statement
relating to a public offering of up to 20,000,000 shares of common
stock at $0.01 per share, or $200,000 total. On October 26, 2007,
the Company completed its public offering. A total of 10,000,000
shares of common stock were sold, resulting in gross proceeds to
the Company of $100,000.
10
Note 8. Income Taxes
Potential benefits of income tax losses are not recognized in the
accounts until realization is more likely than not. At January 31,
2010, the Company had a net operating loss carryforward of
$158,395, which expires $18,050 in 2026, $21,490 in 2027, $25,510
in 2028, $41,358 in 2029 and $51,987 in 2030. Pursuant to
Accounting Standards Codification ("ASC") 740, "Income Taxes", the
Company is required to compute tax asset benefits for net
operating losses carried forward. The potential benefits of the
net operating loss carryforward have not been recognized in these
financial statements because the Company has not determined it to
be more likely than not that it will utilize the net operating
loss carryforward in future years. At January 31, 2010, the
valuation allowance established against the deferred tax asset is
$53,854.
The components of the net deferred tax asset and the amount of the
valuation allowance are scheduled below:
Current United States income tax laws limit the amount of loss
available to offset against future taxable income when a
substantial change in ownership occurs. Therefore, the amount
available to offset future taxable income may be limited.
Note 9. Subsequent Events
The Company has evaluated subsequent events through the filing
date of this Form 10-Q and has determined that there were no
subsequent events to recognize or disclose in these financial
statements.
11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
TOC
PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
ALL FORWARD-LOOKING STATEMENTS CONTAINED HEREIN ARE DEEMED BY THE
COMPANY TO BE COVERED BY AND TO QUALIFY FOR THE SAFE HARBOR
PROTECTION PROVIDED BY THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995. PROSPECTIVE SHAREHOLDERS SHOULD UNDERSTAND THAT SEVERAL
FACTORS GOVERN WHETHER ANY FORWARD - LOOKING STATEMENT CONTAINED
HEREIN WILL BE OR CAN BE ACHIEVED. ANY ONE OF THOSE FACTORS COULD
CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE PROJECTED
HEREIN. THESE FORWARD - LOOKING STATEMENTS INCLUDE PLANS AND
OBJECTIVES OF MANAGEMENT FOR FUTURE OPERATIONS, INCLUDING PLANS
AND OBJECTIVES RELATING TO THE PRODUCTS AND THE FUTURE ECONOMIC
PERFORMANCE OF THE COMPANY. ASSUMPTIONS RELATING TO THE FOREGOING
INVOLVE JUDGMENTS WITH RESPECT TO, AMONG OTHER THINGS, FUTURE
ECONOMIC, COMPETITIVE AND MARKET CONDITIONS, FUTURE BUSINESS
DECISIONS, AND THE TIME AND MONEY REQUIRED TO SUCCESSFULLY
COMPLETE DEVELOPMENT PROJECTS, ALL OF WHICH ARE DIFFICULT OR
IMPOSSIBLE TO PREDICT ACCURATELY AND MANY OF WHICH ARE BEYOND
THE CONTROL OF THE COMPANY. ALTHOUGH THE COMPANY BELIEVES THAT
THE ASSUMPTIONS UNDERLYING THE FORWARD - LOOKING STATEMENTS
CONTAINED HEREIN ARE REASONABLE, ANY OF THOSE ASSUMPTIONS COULD
PROVE INACCURATE AND, THEREFORE, THERE CAN BE NO ASSURANCE THAT
THE RESULTS CONTEMPLATED IN ANY OF THE FORWARD - LOOKING
STATEMENTS CONTAINED HEREIN WILL BE REALIZED. BASED ON ACTUAL
EXPERIENCE AND BUSINESS DEVELOPMENT, THE COMPANY MAY ALTER ITS
MARKETING, CAPITAL EXPENDITURE PLANS OR OTHER BUDGETS, WHICH MAY
IN TURN AFFECT THE COMPANY'S RESULTS OF OPERATIONS. IN LIGHT OF
THE SIGNIFICANT UNCERTAINTIES INHERENT IN THE FORWARD - LOOKING
STATEMENTS INCLUDED THEREIN, THE INCLUSION OF ANY SUCH STATEMENT
SHOULD NOT BE REGARDED AS A REPRESENTATION BY THE COMPANY OR ANY
OTHER PERSON THAT THE OBJECTIVES OR PLANS OF THE COMPANY WILL BE
ACHIEVED.
12
Overview of the Company's Business
We are a development stage Corporation and have not yet generated
or realized any revenues from our business operations.
In April 2006, Shu-heng Wang, our former president acquired one
mining claim containing fourteen cells in British Columbia, Canada
(Property) by arranging the registration of the same through
James W. McLeod, a geologist, a non affiliated third party. A
claim is a grant from the Crown of the available land within the
cells to the holder to remove and sell minerals. A cell is an
area which appears electronically on the British Columbia Internet
Minerals Titles Online Grid. The online grid is the geographical
basis for the cell. Mr. McLeod is a self-employed contract staker,
field worker and professional geologist residing in British Columbia.
Our exploration target is to find an ore body containing gold. Our
success depends upon finding mineralized material. Mineralized
material is a mineralized body, which has been delineated by
appropriate spaced drilling or underground sampling to support
sufficient tonnage and average grade of metals to justify removal.
This includes a determination by our consultant if the property
contains reserves.
As a continuation of the exploration program, Sookochoff Consultants
Inc. has completed a prospecting on the Property in November 2008.
The purpose of the prospecting program was to locate any indications
of copper or gold mineralization or coal bearing horizons with the
rocks that are indicated to outcrop on the Property. In this
prospecting program, adequate coverage of the property was made to
locate outcrop or float material which could have provided indications
of copper or gold mineralization and/or coal bearing sediments.
Unfortunately, in the few outcrops found and examined in the northeast,
the basalts were fresh with no mineralization or alteration. As a
result of this prospecting program, the Property does not warrant
any additional exploration and/or expenditures and is recommended to
be allowed to expire.
Based on the recommendation from the geologist consultant, the Company
started to look for other business opportunities. On March 25, 2009,
the Company and Beijing RainEarth Technology Co. Ltd., a company
organized and existing under the laws of the People's Republic of China
(China RainEarth), entered into a Business Cooperation Agreement
(the Agreement) for a term of twenty years. The purpose of the Agreement
is to jointly conduct Hollow Fiber Membrane Materials application and
manufacturing business in China.
13
The Company will provide Advice and assistance relating to development
of marketing and provision of consultancy services, particularly as
related to the Business to China RainEarth, and take such action as
may be reasonably required to raise up to RMB 136 million ($ 20 million
U.S. Dollar) of China RainEarth's financial obligations.
China RainEarth will retain the services of the Company in relation
to the current and proposed operations of China RainEarth's business
in the People's Republic of China. China RainEarth will give 60% of
its revenue after deduction of direct operating costs, expenses and
taxes to the Company in consideration of the Company's services.
The Company has changed its name to RainEarth Inc. to better reflect
its current business.
We have had no revenues and have experienced losses since inception.
Our future revenues will depend on the result of operations of China
RainEarth. China RainEarth was established in October, 2005 in Beijing,
China. China RainEarth is a hi-tech enterprise which is dedicated to
the research & development and application of fiber membrane
technologies. Developed independently by China RainEarth, the
techniques for manufacturing hollow fiber membranes and fiber
drawing equipment broke through foreign (mainly German) technical
monopoly, and gained supports from the Beijing Innovation Fund for
Small and Medium Enterprises in 2007, along with the Beijing Municipal
Science & Technology Commission and the Innovation Fund for the 1st
Batch of Small and Medium Technical Enterprises in 2008, the fund was
released from the Ministry of Science and Technology in China.
Hollow fiber membranes, as a core component of special filtration
absorbers, are widely used in blood purification, ascites reinfusion
and water treatment, etc.
China RainEarth initially chose the benchmark product blood dialyzer,
which can best certify their product research & development and
manufacturing advantages, as the market entry point, and then further
entered concentrator and water purification markets.
Blood dialysis is an effective measure for patients with acute and
chronic renal failure (uremia) to sustain their lives. In 2007, 7-8
million pieces of blood dialyzers were consumed in China. With the
rapid social and economic development as well as improvement of
healthcare services, 15 million pieces of blood dialyzers will be
consumed in China by 2012 and the market size may approximate US$200
million. 70 million pieces of dialyzers are consumed each year in
developing countries including Turkey, India, South Africa and
Pakistan, according to the Company's own research.
14
We have been issued a going concern opinion and rely upon the sale of
our securities and loans from our officers and directors to fund
operations.
We may not have enough money to complete our business plan. If it
turns out that we have not raised enough money to complete our
business plan, we will try to raise additional funds from a second
public offering, a private placement or loans. At the present time,
we have not made any plans to raise additional money and there is
no assurance that we would be able to raise additional money in the
future. In we need additional money and can not raise it, we will
have to suspend or cease operations.
Our auditors have issued a going concern opinion. This means that
there is substantial doubt that we can continue as an on-going
business for the next twelve months unless we obtain additional
capital to pay our bills. This is because we have not generated
any revenues and no revenues are anticipated until we begin
removing and selling minerals. There is no assurance we will ever
reach this point. Accordingly, we must raise cash from sources
other than the sale of minerals found on the property. Our only
other source for cash at this time is investments by others. We
must raise cash to implement our project and stay in business.
If we raise the minimum amount of money in the public offering,
we believe it will last twelve months.
Need for Additional Capital
There is no historical financial information about us upon which
to base an evaluation of our performance. We are an exploration
stage corporation and have not generated any revenues from
activities. We cannot guarantee we will be successful in our
business activities. Our business is subject to risks inherent
in the establishment of a new business enterprise, including
limited capital resources, and possible cost overruns due to
price and cost increases in services.
To become profitable and competitive, we must conduct the research
and exploration of our property before we start production of any
minerals we may find.
We have no assurance that future financing will be available to us
on acceptable terms. If financing is not available on satisfactory
terms, we may be unable to continue, develop or expand our
activities. Equity financing could result in additional dilution
to existing shareholders.
15
Results of Operations
For the Three Months ended January 31, 2010
Operating Revenues. Operating revenues for the three months ended
January 31 of 2010 and 2009 were both $0.
Operating Expenses. The Company's operating expenses totaled $15,716
for the quarter ended January 31, 2010, compared to $6,039 for the
same quarter of 2009. The change was mainly caused by adding
amortization of investment in Beijing RainEarth.
Loss from Operations. The Company has recorded a loss of $15,716
for the quarter ended January 31, 2010, compared to a loss of
$6,039 for 2009. The difference was caused mainly by adding
amortization of investment in Beijing RainEarth.
Net Loss. The Company had a net loss of $15,716 and $6,039 for
the quarter ended January 31, 2010 and 2009, mainly due to the
increased amortization of investment in Beijing RainEarth.
Liquidity and Capital Resources
As of the date of this quarterly report, we have yet to generate
any revenues from our business activities.
Cash balances as of January 31, 2010 and April 30, 2009 were
$13,182 and $52,470.
Net cash provided by financial activities for three months
ended January 31, 2010 and 2009 were both $0.
As of January 31, 2010, our total assets were $625,741and total
liabilities were $71,568.
Off Balance Sheet Arrangements
We do not have any obligations that meet the definition of an
off-balance-sheet arrangement that have or are reasonably likely
to have a material effect on our financial statements, which has
not been consolidated.
16
Critical Accounting Policies
The preparation of financial statements in conformity with
accounting principles generally accepted in the U.S., or GAAP,
requires the Company 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
revenues and expenses during the reporting period. Actual
results could differ from those estimates. In recording
transactions and balances resulting from business operations,
the Company uses estimates based on the best information
available for such items as depreciable lives. The Company
revises the recorded estimates when better information is
available, facts change or actual amounts can be determined.
These revisions can affect operating results.
ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
None
ITEM 4. CONTROLS AND PROCEDURES
Our Principal Executive Officer and Principal Financial Officer,
after evaluating the effectiveness of our disclosure controls
and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under
the Exchange Act) as of the end of the period covered by this
report, have concluded that, based on the evaluation of these
controls and procedures, that our disclosure controls and
procedures were effective.
There were no changes in our internal controls or in other factors
during the period covered by this report that have materially
affected, or are likely to materially affect the Company's
internal controls over financial reporting.
ITEM 4A. INTERNAL CONTROL OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial
reporting during our last fiscal quarter that have materially
affected or are reasonably likely to materially affect our
internal control over financial reporting.
17
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
None.
ITEM 1A- RISK FACTORS
There were no material changes to Risk Factors disclosed in this
Form 10-Q for the quarter ended January 31, 2010.
ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5 - OTHER INFORMATION
None.
18
ITEM 6 - EXHIBITS
Exhibit No.Document Description
31.1Certification of Principal Executive Officer pursuant to
Rule 13a-15(a) and Rule 15d-15(a), promulgated under the Securities
Exchange Act of 1934, as amended.
31.2Certification of Principal Financial Officer pursuant to
Rule 13a-15(a) and Rule 15d-15(a), promulgated under the
Securities Exchange Act of 1934, as amended.
32.1Certification 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.
32.2Certification 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.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized, on this 17 day of March, 2010.
RainEarth Inc
(the "Registrant")
BY:/s/ YongFu Zhu
YongFu Zhu,President, Principal
Executive Officer
BY:/s/ TianHui Yin
TianHui Yin, Secretary, Treasurer,
Principal Financial Officer and Principal
Accounting Officer
19
EXHIBIT 31.1
CERTIFICATION PURSUANT TO SECTION
302 OF THE SARBANES OXLEY ACT
I, Zhu, YongFu, certify that:
(1) I have reviewed this quarterly report on Form 10-Q of RainEarth Inc.;
(2) Based on my knowledge, this report does not contain any untrue
statement of a material act 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 small business issuer as of, and for, the periods
presented in this report;
(4)The small business issuer's other certifying officer(s) 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))
for the small business issuer 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 small business
issuer, 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 purpose in accordance with general accepted
accounting principles;
(c) Evaluated the effectiveness of the small business issuer'sdisclosure
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
20
(d) Disclosed in this report any change in the small business issuer's
internal control over financial reporting that occurred during the small
business issuer's most recent fiscal quarter (the small business
issuer's fourth fiscal quarter in the case of an annual report) that
has materially affected, or is reasonably likely to materially affect,
the small business issuer's internal control over financial reporting;
and
(5) The small business issuer's other certifying officer(s) and I have
disclosed, based on our??most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and
the audit committee of the small business issuer'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 small business
issuer'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 small business
issuer's internal control over financial reporting.
RainEarth Inc.
March 17, 2010
By:/s/Zhu, YongFu
Zhu, YongFu
President, Chairman
21
EXHIBIT 31.2
CERTIFICATION PURSUANT TO SECTION
302 OF THE SARBANES OXLEY ACT
I, Yin, TianHui, certify that:
(1) I have reviewed this quarterly report on Form 10-Q of RainEarth Inc.;
(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 small business issuer as of, and for, the periods presented in this
report;
(4) The small business issuer's other certifying officer(s) 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))
for the small business issuer 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 small business issuer,
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 purpose in accordance with general accepted
accounting principles;
(c) Evaluated the effectiveness of the small business issuer'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
22
(d) Disclosed in this report any change in the small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
(the small business issuer's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably
likely to materially affect, the small business issuer's internal
control over financial reporting; and
(5) The small business issuer's other certifying officer(s) and I
have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the small business issuer's
auditors and the audit committee of the small business issuer'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 small business issuer'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 small business
issuer's internal control over financial reporting.
RainEarth Inc.
March 17, 2010
By:/s/ Yin, TianHui
Yin, TianHui
Director and Secretary
23
Exhibit 32.1
CERTIFICATION OF DISCLOSURE PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Zhu, YongFu, President of RainEarth Inc. (formerly GOLD ROCK
RESOURCES, INC.) certify pursuant to 18 U.S.C. Section 1350 as
enacted by Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Quarterly Report on Form 10-Q for the quarterly period
ended January 31, 2010 (the "Periodic Report") which this
statement accompanies fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) information contained in the Periodic Report fairly presents,
in all material respects, the financial condition and results of
operations of RainEarth Inc.
RainEarth Inc
March 17, 2010
By:/s/ Zhu, YongFu
Zhu, YongFu
President
A signed original of this written statement required by Section
906, or other document authenticating, acknowledging or otherwise
adopting the signature that appears in typed form within the
electronic version of this written statement required by Section
906, has been provided to RainEarth Inc. and will be retained by
RainEarth Inc. and furnished to the Securities and Exchange
Commission or its staff upon request.
24
Exhibit 32.2
CERTIFICATION OF DISCLOSURE PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Yin, TianHui, Secretary of RainEarth Inc. (formerly GOLD
ROCK RESOURCES, INC.), certify pursuant to 18 U.S.C. Section 1350 as
enacted by Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Quarterly Report on Form 10-Q for the quarterly period
ended January 31, 2010 (the "Periodic Report") which this statement
accompanies fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and
(2) information contained in the Periodic Report fairly presents,
in all material respects, the financial condition and results of
operations of RainEarth Inc.
RainEarth Inc.
March 17, 2010
By:/s/ Yin, TianHui
Yin, TianHui
Secretary
A signed original of this written statement required by Section
906, or other document authenticating, acknowledging or otherwise
adopting the signature that appears in typed form within the
electronic version of this written statement required by Section
906, has been provided to RainEarth Inc. and will be retained by
RainEarth Inc. furnished to the Securities and Exchange Commission
or its staff upon request.
25