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Anyone have any numbers? Shares out.. etc?
Still Here - Don't think it was a fat finger - quite a few sales went through around $1 then it sputtered up and down. Makes you wonder if someone knows something. It did this on a lesser scale I think a few months back.
It appears based on their filings they are starting to stabilize - their numbers got thrown for a loop when they had to sell and lease-back their buildings due to some governmental regulation.
It really damaged their numbers.
Overall I think they can recover - the economy is picking up in China, the last statement had them in the black I believe. Also I did some research a few months back as I was concerned if they were legitimate or not, I found stories about exchange programs they have with some US schools. I found reports about their stays there, etc...
If they start showing some good enrollment gains, things should continue to look good.
The buy yesterday was 5k shares? if so, I do think that is pretty telling - gotta wonder if the mm's did the $10 at .04 to bring it back - of if a buyer is trying to pull it back and get in a little lower.
I missed it! I checked in the AM, but nothing at that point, how many shares moved at that price? Looking at the firts quater earning last week, I noticed it appears the whole building issue has worked itself through, and a small gain was on the books for the quarter.
His shares may be restricted, but the company can issue shares - Like I said in my earlier post, I would assume the company would sell some shares to ramp up operations, and to apy employees, etc... as long as it isn't a continued flow - and real growth happens, it won't be a negative impact.
My guess on the public piece is that they do want o ramp up operations, even though debt isn't being carried or created necessarily due to the new operations, to acquire and keep staff, some form of income will have to generated at the beginning.
So I do anticipate some share selling by the Co. if te business model is sound, contracts established, and income starts coming in we will still be in great shape. as long as absurd amounts of shares aren't sold. Also - witha stronger stock price in the future, it will give the company more opportunities, especially if credit markets remain tight.
Any Scottraders Here? If so, did you have to call in a buy order, after it changed to ALCD?
I find the willingness to avoid the PR fees as a positive. If this were to be a pump and dump, a grand or two to get the wheels turning would be a worthwhile "investment" for a pumper.
Someone looking to conserve cash, build a company will, and isn't looking to sell shares at this time, will definitely look to find the most economical way possible to spread their message.
I would also have no problem seeing less significant updates being posted on Pinksheets only, while big news that would support an increase in value in the company and ultimately support long term share price increases be released on the newswire.
This is all my opinion!
Thanks for the update - I was owndering how this would help China Ivy - I also had a very hard time finding any info on youbang.
What document lists the marketing company, and what is it? Also, which attorney?
Thanks!
This is all my opinion - but say a company is working a deal right now - and wants to wait to make sure it is 100% complete before they PR it, I would much rather wait for a done deal, than get another - it is in the pipeline PR.
I don't know if that's the case here, but I can't imagine that Alco did this merger for pure fun. I do take comfort that they didn't come out the gate pumping out fluff prs, and dumping shares.
Good to see some interest.
I didn't get a chance to do more than glance at the 10k - from what I saw, it looked like there was nothing shocking, or unexpected. The only item I checked was enrollment, which was down slightly.
I would like more info on how the new HR aquisition should help overall, and also the bottom line.
I have been overall happy with Zecco since I switched, Same reasons. One other feature i really enjoy as compared to Scottrade, is the ability to set higher limit prices in relation to current price on my orders online. On Scottrade I believe you had to call them in if you wanted to exceed 100% of current price. In penny land it becomes a pain to set GTC orders. Zecco will warn you that your target price is above 50% of current, but still allows it.
It will be interesting to see how the year overall played out - I am still wondering wat is going on with the purchase of the HR co. If things are starting to look up, I really do hope they use an IR/promotion person to help keep us and the world informed.
Valuation thought - If you divide my zecco buying power by the amount of asii shares I have it comes out to $3.25 - possible pps? That would be nice! take into account the 1/1400 split and it would still be a few g's profit! not rich but better than nothing.
Not sure if my math or my method is right - just throwing stuff out there.
I have that too also shows asii, but does say under it that it has a symbol change - but share amounts and value are the same - not the same amount - but millions - how tempting to try and flip a few big boards...
this just in... Sources have leaked that Rosie O'Donnel is announced as the winner of the next Celebrity Fit Club!
If Alco is a real company, with real product, and real revenue - the reverse will hurt, but can be made up for.
It's the reverse pump and re-dilute that kills.
Lets hope for scenario A
Could be interesting if Axion was merged- in may make sense, but the record should indicate what was merged shouldn't it? Starnge that Axion is gone though!
If a PR was to come out, I would be looking more to expect it Monday AM. You never know though!
ALL IMO
I'd be happy to see a lot of .0001 buying with no news - Maybe shares being bought back -
Hoping for all here that something is happening.
Where did everyone go?
Wow - It's alive - nice to see it move on relatively low volume, and no news out there.
Hopefully a sign of things to come!
Very True - I think an actual PR release of the recent info may do some to boost things here. Maybe they are waiting to be able to back up more of it with some substance before really launching?
there it is - would definitely like to see a higher bid! The ask at $1 is very reasonable I think. I hope they do meet their hope of getting listed to an exchange.
Need a new bid and ask to go along with the new share structure. Hopeing to start hearing some news from China Ivy, the float on this is now pretty low at about 3 mil
That's true, wouldn't make sense at all, at leat not today - If no interest was here and no news on the front, and they needed cash I would say maybe, but if we play out the scenario that it is CBAY selling through BMAS, then they are the only ones holding it down, to their own detriment. - If I was them and was planning on selling, I would at least let the bid come back, and see if we can start hitting the 2's strong, or go even higher before unloading.
Yes- Happy New Year to all - Hope it does bring some positive news
Lerner - I do hope that they would not shoot their own foot.
If I have time I will see if I can read through the initial filings for this co and see how those shares were issued - if money was paid for many of them - then I absolutely expect that they will do whatever it takes in their power to bring this back up.
Volume lately has been interesting - Shouldn't thie split happen very soon? I'm guessing any day now since the filing was done? I'm holding out hope that the reverse was done more to open up available shares for aquisition and not sale, that scenario would support the buying we are seeing. ALL IMO
Looks like we have a bid and ask!
Thanks again - I skimmed it, but didn't catch that.
Thanks for the post - I wonder when it is in effect? as of yuesterday? hopefully we don't trade lower before hand. I also am hoping for news otehr other positive movement following the split.
It's Alive!
I wonder if the split is on hold? I know it said on or about 11/20 - but history has shown that it happens within a day or two of the announced date. Anyone have any new info?
Yes - Hopefully we start hearing from them. It appears that some trades are going through - although I still don't see a bid or ask.
Good sign I guess-
I was wondering if that had to happen in order to do the split.
10Q Out:
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
S QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2008
£ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
Commission File Number: 000-53246
CELLTECK, INC.
(Exact name of small business as specified in its charter)
Nevada
98-0550353
(State or other jurisdiction of
(IRS Employer Identification Number)
incorporation or organization)
417 Exeter Road, London, ON Canada N6E 2Z3
(Address of principal executive offices)
(519) 963-0668
(Issuer's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
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 S No £
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer £ Accelerated filer £ Non-accelerated filer (Do not check if a smaller reporting company) £
Smaller reporting company S
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes £ No S
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. The Issuer had 61,633,891 shares of common stock outstanding as of November 17, 2008.
--------------------------------------------------------------------------------
CELLTECK, INC. TABLE OF CONTENTS
Page No.
PART I. FINANCIAL INFORMATION
Item 1.
Financial Statements
Balance Sheet as of September 30, 2008 (unaudited)
3
Statement of Operations for the three month and nine month periods ended September 30, 2008 (unaudited) and September 30, 2007 (unaudited)
4
Statement of Cash Flow for the nine month periods ended September 30, 2008 (unaudited) and September 30, 2007 (unaudited)
5
Notes to Financial Statements
6
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
9
Item 3
Quantitative and Qualitative Disclosures About Market Risk
10
Item 4T.
Controls and Procedures
10
PART II. OTHER INFORMATION
Item 1A
Risk Factors
11
Item 4
Submission of Matters to a Vote of Security Holders
13
Item 6.
Exhibits
14
SIGNATURES
15
2
--------------------------------------------------------------------------------
Forward Looking Statements
The Company desires to take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. This report contains a number of forward-looking statements that reflect management's current views and expectations with respect to our business, strategies, future results and events and financial performance. All statements made in this Report other than statements of historical fact, including statements that address operating performance, events or developments that management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, adequacy of funds from operations, statements expressing general optimism about future operating results and non-historical information, are forward looking statements. In particular, the words "believe," "expect," "intend," " anticipate," "estimate," "may," "will," variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances. Readers should not place undue reliance on these forward-looking statements, which are based on management's current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below) and apply only as of the date of this report. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
CELLTECK, INC.
BALANCE SHEETS - unaudited
September 30, 2008 and December 31, 2007
Sept 30,
Dec 31,
2008
2007
ASSETS
CURRENT ASSETS
Cash
$
344
$
544
Inventory - for resale
10,085
10,552
Total Current Assets
$
10,429
$
11,096
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
Accounts payable
$
388
$
1,364
Accounts payable - related parties
203,228
191,967
Total Current Liabilities
203,616
193,331
STOCKHOLDERS' DEFICIENCY
Preferred stock
100,000,000 shares authorized at $.0001 par value - none out
-
-
Common stock
300,000,000 shares authorized at $.0001 par value
61,633,891 shares issued and outstanding
6,163
6,163
Capital in excess of par value – deficiency
463
463
Accumulated deficit
(199,813)
188,861)
Total Stockholders’ Deficiency
(193,187)
(182,235)
$
10,429
$
11,096
The accompanying notes are an integral part of these financial statements
3
--------------------------------------------------------------------------------
CELLTECK, INC.
STATEMENT OF OPERATIONS -unaudited
For the Three and Nine Months Ended September 30, 2008 and 2007
Three Months
Nine Months
Sept 30,
Sept 30,
Sept 30,
Sept 30,
2008
2007
2008
2007
SALES
$
4,135
$
818
$
9,840
$
5,111
COST OF SALES
215
876
467
1,065
Gross profit
3,920
(58)
9,373
4,046
EXPENSES
Administrative
7,448
7,894
20,325
18,423
NET LOSS
$
(3,528)
$
(7,952)
$
(10,952)
$
(14,377)
NET LOSS PER COMMON
SHARE
Basic and diluted
$
-
$
-
$
-
$
-
AVERAGE OUTSTANDING
SHARES - stated in 1,000's
Basic
61,634
61,634
61,634
61,634
The accompanying notes are an integral part of these financial statements
4
--------------------------------------------------------------------------------
CELLTECK, INC.
STATEMENT OF CASH FLOWS - unaudited
For the Nine Months Ended September 30, 2008 and 2007
Sept 30,
Sept 30,
2008
2007
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)
$
(10,952)
$
(14,377)
Adjustments to reconcile net loss to
net cash provided by operating activities
Changes in accounts receivable
-
(298)
Changes in inventory
467
1,112
Changes in accounts payable
(976)
(313)
Net Changes in Cash from Operations
(11,461)
(13,876)
CASH FLOWS FROM INVESTING ACTIVITIES
-
-
CASH FLOWS FROM FINANCING ACTIVITIES
Advances from related parties
11,261
12,847
Net Increase (Decrease) in Cash
(200)
(1,029)
Cash at Beginning of Period
544
1,523
Cash at End of Period
$
344
$
494
The accompanying notes are an integral part of these financial statements.
5
--------------------------------------------------------------------------------
CELLTECK, INC.
NOTES TO FINANCIAL STATEMENTS
September 30, 2008
1. ORGANIZATION
Cellteck, Inc. (formerly Safe Cell Tab, Inc.) (the "Company") was organized to serve as a vehicle for the re-organization and spin-off of the Safe Cell Tab, Inc. business and exist as its successor in interest. The Company was incorporated on May 9, 1996 under in the Province of British Columbia, Canada with authorized 10,000 common shares with a par value of $1.00. As a result of the reorganization the Company changed its domicile to the state of Nevada and changed its authorized capital stock to 300,000,000 shares common stock and 100,000,000 shares preferred stock with a par value of $.0001. The Company made several name changes resulting in its present name.
On August 22, 2003 (as amended), the Company was acquired by Claremont Technologies Corp as a wholly owned subsidiary.
On August 21, 2008 the Company completed a forward stock split from 8,680 outstanding common shares to 61,633,891 common shares. The post split outstanding shares have been shown from inception.
The Company is in the business of pursuing the marketing and sales of the “Safe Cell Tab”. The Safe Cell Tab is a small, thin, oval shaped device designed specifically to help protect the users of cell phones, cordless phones, laptops, microwaves and any other hand held devices from the potentially harmful effects of electronic radiation which is emitted from these and other electronic devices.
This report includes the financial statements of the Company only and has not been consolidated with its former parent.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
The Company recognizes income and expenses based on the accrual method of accounting.
Dividend Policy
The Company has not adopted a policy regarding payment of dividends.
Income Taxes
The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recorded, when it is more likely than not, that such tax benefits will not be realized.
On September 30, 2008 the Company had a net operating loss carry forward of $199,813. The use of the income tax benefit from the loss carry forward may not be available for carry forward because the parent Company has filed consolidated tax returns.
6
--------------------------------------------------------------------------------
CELLTECK, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
September 30, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Inventory
Inventory is stated at the lower of cost or market using the first in first out method.
Basic and Diluted Net Income (Loss) Per Share
Basic net incomes (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been issued on the exercise of any common share rights unless the exercise becomes antidilutive and then only the basic per share amounts are shown in the report.
Foreign Currency Translation
Part of the transactions of the Company were completed in Canadian dollars and have been translated to US dollars as incurred, at the exchange rate in effect at the time, and therefore, no gains or losses are recognized from the translations. US dollars are considered to be the functional currency.
Financial Instruments
The carrying amounts of financial instruments are considered by management to be their estimated fair values due to their short term maturities.
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements.
Financial and Concentrations Risk
The Company does not have any concentration or related financial credit risk.
Revenue Recognition
The Company recognizes revenue in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements” (“SAB No. 101”), as amended by SAB No. 101A and SAB No. 101B. SAB No. 101 requires that four basic criteria must be met before revenue can be recognized: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred or services rendered; (iii) the fee is fixed and determinable; and (iv) collectability is reasonably assured. Determination of criteria (iii) and (iv) are based on management’s judgments regarding the fixed nature of the fee charged for services rendered and products delivered and the collectability of those fees. Should changes in conditions cause management to determine these criteria are not met for certain future transactions, revenue recognized for any reporting period could be adversely affected. The Company has concluded that its revenue recognition policy is appropriate and in accordance with accounting principles generally accepted in the United States of America and SAB No. 101.
Revenues are exclusive for the sales of our products, we do not sell services. Revenue is recognized at the time of shipping determined as F.O.B our loading dock. Products prices are fixed and are determined at the time of shipping, inclusive of all volume or other available discounts. Returns policy includes accounting for returns drawn from a return pool that is adjusted quarterly as required under the GAAP estimated return criteria. Historically, the return of products has been non-material.
Advertising and Market Development
The company expenses advertising and market development costs as incurred.
7
--------------------------------------------------------------------------------
CELLTECK, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
September 30, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent Accounting Pronouncements
The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements.
3. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES
The Company entered into a working capital arrangement with a related party, whereby we will have at our disposal a $150,000 line of credit for ongoing operational and general company expenses. We believe this operating line of credit will be sufficient to meet our financial needs for our first 12 month period.
4. GOING CONCERN
The Company does not have the necessary working capital to service its debt and for its planned activity, which raises substantial doubt about its ability to continue as a going concern.
Continuation of the Company as a going concern is dependent upon obtaining additional working capital and the management of the Company has developed a strategy, which it believes will accomplish this objective through additional loans from officers, if needed, and equity funding which will provide sufficient working capital necessary to conduct operations for the coming year. (see note 5)
5. SUBSEQUENT EVENTS
The Company will distribute as payment of the debt due the related parties a yet to be determined, number of preferred shares. The preferred shares will be convertible to common shares at the rate of 2 common for 1 share of preferred at the option of the holder.
As of September 30, 2008, the Company, has a total debt of $203,228, and which upon the issuance of preferred shares, shall be debt free. Furthermore, the related parties operating line of credit in the amount of $150,000 is available to the company to meet its operating and financial obligations for the subsequent twelve months period. Management believes the removal of debt and the operating line of credit will be sufficient to meet the company’s financial requirement.
8
--------------------------------------------------------------------------------
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Forward Looking Statements
Certain statements in the Management’s Discussion and Analysis (“MD&A”), other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section under “Risk Factors”. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise
RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007
The following table presents the statement of operations for the three and nine months ended September 30, 2008 as compared to the comparable period of 2007. The following discussion is based on these results.
Three Months
Nine Months
Sept 30,
Sept 30,
Sept 30,
Sept 30,
2008
2007
2008
2007
NET REVENUE
$
4,135
$
818
$
9,840
$
5,111
COST OF SALES
215
876
467
1,065
Gross profit
3,920
(58)
9,373
4,046
EXPENSES
Administrative
7,448
7,894
20,325
18,423
NET LOSS
$
(3,528)
$
(7,952)
$
(10,952)
$
(14,377)
Results of Operations for the Three Months Ended September 30, 2008.
Net Revenue
Net revenue for the three months ended September 30, 2008 totaled $4,135 compared to $818 for the three months ended September 30, 2007, a increase of $3,317, or approximately 405%. The increase was due to expanding retail sales of the product.
Operating Expenses
Operating expenses for the three months ended September 30, 2008 totaled $7,663 or approximately 185% of net revenue, compared to $8,770 or approximately 1072% of net revenue for the three months ended September 30, 2007. The decrease in operating expenses of $1,107, or approximately 26.7%, was minimal due to decrease in operating expenses.
Net Income (Loss)
Loss from operations for the three months ended September 30, 2008 was $3,528, or approximately 85.3% of net revenue, as compared to income from operations of $7,952 or approximately 972% of net revenue for the three months ended September 30, 2007, a increase in income from operations of $3,317 or approximately 80.2%. The increase in income was due to an increase in our revenue and a decrease in our operating expenses as described above.
9
--------------------------------------------------------------------------------
RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007
Net revenue
Net revenue for the nine months ended September 30, 2008 totaled $9,840 compared to $5,111 for the nine months ended June 30, 2007, an increase of $4,729 or approximately 92.5%. The increase was as described above.
Operating Expenses
Operating expenses for the nine months ended September 30, 2008 totaled $20,792 or approximately 211.3% of net revenue, compared $19,488 or approximately 381.29% for the nine months ended June 30, 2007. The increase in operating expenses of $1,304 or approximately 13.25% was due to the increase in general and administrative expenses.
Net Income (Loss)
Loss from operations for the nine months ended September 30, 2008 was $(10,952) or approximately 111.3% of net revenue as compared to loss from operations of $(14,377) or approximately 281.29% of net revenue for the nine months ended September 30, 2007, a decrease of $3,425 or approximately 34.8%. The increase in income was due to a increase in our net revenue of $4,729 and an minimal increase in our operating expenses of $1,837. The increase does not represent a substantive amount.
LIQUIDITY AND CAPITAL RESOURCES
We are funded primarily by cash from operations and advances from related parties. Cash has historically been generated from operations. Operations and liquidity needs are funded primarily through cash flows from operations and related parties borrowings. Cash and cash equivalents were $344 at September 30, 2008 and current assets totaled $10,429 at September 30, 2008.(Cash and Inventory valued at cost). The Company's total current liabilities were $203,616 at September 30, 2008. Working capital at September 30, 2008 was $(199,813).
We expect the funds from operations will not provide us with sufficient capital to fund our continuing operations for the foreseeable future. Instead, we will be required to increase borrowings or raise funds through the offering of private placements, until such time cash flows from operations support current operations as well as servicing our debt. In addition, from time to time we borrow funds from management to cover current operational requirements.
Working Capital Arrangement
We entered into a financial arrangement with a related party, whereby we will have at our disposal a $150,000 line of credit for ongoing operational and general company expenses. We believe this operating line of credit will be sufficient to meet our financial needs for our first 12 month period.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not Applicable.
Item 4T. Controls and Procedures.
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of "disclosure controls and procedures" in Rule 13a-15(e). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
As of the end of the period covered by this report, our management, including our principal executive officer and our principal financial officer, have conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15 under the Securities Exchange Act of 1934). Based upon that evaluation, our principal executive officer and our chief financial officer have concluded that our disclosure controls and procedures are effective in timely alerting them of material information relating to us that is required to be disclosed by us in the reports we file or submit under the Exchange Act. There have been no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
10
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Management's Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial reporting refers to the process designed by, or under the supervision of Mr. Gus Rahim, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP, and includes those policies and procedures that:
(1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management and directors; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of our internal control over financial reporting as of September 30, 2008. Based on that evaluation, Mr. Gus Rahim concluded that as of September 30, 2008, and as of the date that the evaluation of the effectiveness of our disclosure controls and procedures was completed, our disclosure controls and procedures were effective to satisfy the objectives for which they were intended.
This quarterly report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management's report in this quarterly report.
Changes in Internal Controls over Financial Reporting.
During the quarterly period ending September 30, 2008, there were no changes in our internal control over financial reporting identified in connection with the evaluation performed during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II--OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not a party to any legal proceedings.
Item 1A. Risk Factors.
We face widespread competition from other industry related product offerings that may reduce our market share and harm our financial performance.
Competition from other industry related product lines may affect our ability to attract and retain distributors and to decrease sales rates. We may not be able to compete effectively with these companies for product sales or acquisitions in the future.
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If we fail to anticipate or respond adequately to changes in technology and user preferences, our competitive position in this market could be materially adversely affected.
Advances in technology have brought and will likely continue to bring new participants, new products and new channels to the industry. The Internet has emerged as an attractive medium for retail product sales and its use, including as a means to transact commerce through wireless devices, has resulted in new technologies being developed and services provided that compete with our traditional distribution models, products and services. As a result of these factors, our growth and future financial performance may depend on our ability to develop and market new products and services to take advantage of and create new distribution channels, while enhancing existing products, services and distribution channels, to incorporate the latest technological advances and accommodate changing user preferences, including the use of the Internet. We may not be able to adapt our business successfully to these changes in technology.
We may not have access to capital on acceptable terms or at all.
Following the spin-off, we will no longer benefit from China Ivy’s investment grade status and our credit ratings are expected to be substantially lower than the current ratings of China Ivy. Differences in credit ratings affect the interest rates at which we may sell debt securities or borrow funds, as well as the amounts of indebtedness and types of financing structures that may be available to us. We may not be able to raise the capital we require on acceptable terms, or at all. If we are not able to obtain sufficient financing, we may be unable to maintain or grow our business, including through acquisitions. In addition, our financing costs may be higher following the spin-off. Further issuances of equity securities will be subject to limitations imposed on us in financing agreements that we expect to enter into.
Additional regulation regarding information technology could lead to increased costs.
As the Internet industry develops, specific laws relating to the provision of Internet services and the use of Internet and Internet-related applications may become relevant. Regulation of the Internet and Internet-related services is itself still developing both formally by, for instance, statutory regulation, and also less formally by, for instance, industry self regulation. If our regulatory environment becomes more restrictive, including by increased Internet regulation, our profitability could decrease.
Loss of key personnel or our inability to attract and retain highly qualified individuals could materially adversely affect our business.
We depend on the continued services of key personnel, including our experienced senior management team. The loss of key personnel could have a material adverse effect on our business. Our separation from China Ivy could also adversely affect our ability to attract and retain key personnel.
Our ability to achieve our operating goals depends to a significant extent on our ability to identify, hire, train and retain qualified individuals.
The loss of important intellectual property rights could adversely affect our prospects and results of operations.
Some intellectual property rights and other testimonial property rights are key to our business. We rely upon a combination of copyright and trademark laws as well as contractual arrangements to establish and protect our intellectual property rights. We may be required from time to time to bring lawsuits against third parties to protect our intellectual property rights. Similarly, from time to time, we may be party to proceedings by third parties challenging our rights. We cannot be sure that any lawsuits or other actions brought by us will be successful or that we will not be found to infringe the intellectual property rights of third parties. As the Internet grows, it may prove more onerous to protect from domain name infringement or to prevent others from using Internet domain names that associate their business with ours. Although we are not aware of any material infringements that are significant to our business, any lawsuits, regardless of their outcome, could result in substantial costs and diversion of resources and could have a material adverse effect on our business, financial condition or results of operations. Furthermore, the loss of important intellectual property rights, including testimonial property rights, could have a material adverse effect upon our business, financial condition and results of operations.
Our right to use the testimonial property moving forward may be contingent on the successful spin-off.
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Environmental compliance costs and liabilities could adversely affect our operating results, including our cash available for operations.
Our operations, as well as the properties that we own and lease for our business, are subject to stringent laws and regulations relating to environmental protection. Our failure to comply with applicable environmental laws, regulations or permit requirements, or the imposition of liability related to waste disposal or other matters arising under these laws, could result in civil or criminal fines, penalties or enforcement actions, third-party claims for property damage and personal injury or requirements to clean up property or other remedial actions. Some of these laws provide for “strict liability,” which can render a party liable for environmental or natural resource damage without regard to negligence or fault on the part of the party.
In addition, new environmental laws and regulations, new interpretations of existing laws and regulations, increased governmental enforcement or other developments could require us to make additional unforeseen expenditures. Many of these laws and regulations are becoming increasingly stringent, and the cost of compliance with these requirements can be expected to increase over time. To the extent that the costs associated with meeting any of these requirements are substantial and not adequately provided for, there could be a material adverse effect on our business, financial condition and results of operations.
Our exposure to legal proceedings could have a material adverse effect on our operating results or financial condition.
We can expect to be involved with various lawsuits and other claims typical for a business of our size. In addition, from time to time, we may receive communications from government or regulatory agencies concerning investigations or allegations of noncompliance with laws or regulations in jurisdictions in which we operate. We do not expect that the ultimate resolution of pending regulatory and legal matters in future periods will have a material effect on our financial condition. However, any potential judgments, fines or penalties relating to these matters may have a material effect on our results of operations in the period in which they are recognized. See “Business—Legal Proceedings.”
Our reliance on technology could have a material adverse effect on our business.
Some of our business activities rely to a significant degree on the efficient and uninterrupted operation of our computer and communications systems and those of third parties. Any failure of current or, in the future, new systems could impair our collection, processing or storage of data and the day-to-day management of our business. This could have a material adverse effect on our business, financial condition and results of operations.
Our computer and communications systems are vulnerable to damage or interruption from a variety of sources. Despite precautions taken by us, a natural disaster or other unanticipated problems that lead to the corruption or loss of data at our facilities could have a material adverse effect on our business, financial condition and results of operations.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
There are no sales of equity securities during the applicable reporting period.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
The Company did not submit any matters to a vote of our stockholders during the period of this quarter report, except as required by the spin-off transactions with our former parent and related documents thereof.
Item 5. Other Information.
None
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Item 6. Exhibits
The following exhibits are filed as part of this report:
Exhibit No.
Description of Exhibit
31.1
--
Certification of Chief Executive Officer pursuant to Rule
13a-14(a) under the Securities Exchange Act of 1934.
31.2
--
Certification of Chief Financial Officer pursuant to Rule
13a-14(a) under the Securities Exchange Act of 1934.
32.1
--
Certification of Chief Executive Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
32.2
--
Certification of Chief Financial Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: November 18, 2008
CELLTECK, INC.
By: /s/ Gus Rahim
Gus Rahim
President and Chief Executive Officer
(Principal Executive Officer)
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EXHIBIT INDEX
Exhibit No.
Description of Exhibit
31.1
--
Certification of Chief Executive Officer pursuant to Rule
13a-14(a) under the Securities Exchange Act of 1934.
31.2
--
Certification of Chief Financial Officer pursuant to Rule
13a-14(a) under the Securities Exchange Act of 1934.
32.1
--
Certification of Chief Executive Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
32.2
--
Certification of Chief Financial Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
15
Exhibit 31.1
CERTIFICATIONS
I, Gus Rahim, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Cellteck, 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 registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 18, 2008
/s/ Gus Rahim
Gus Rahim, Chief Executive Officer
Exhibit 31.2
CERTIFICATIONS
I, Gus Rahim, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Cellteck, 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 registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 18, 2008
/s/ Gus Rahim
Gus Rahim, Chief Financial Officer
Exhibit 32.1
CERTIFICATIONS PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
In connection with the Quarterly Report of Cellteck, Inc., a Nevada corporation (the "Company"), on Form 10-Q for the quarter ended September 30, 2008, as filed with the Securities and Exchange Commission (the "Report"), Gus Rahim, Chief Executive Officer of the Company, does hereby certify, pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. ss.1350), that to his knowledge:
(1) The Report fully complies with the requirements of section 13(a)or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
November 18, 2008
/s/ Gus Rahim
Gus Rahim, Chief Executive Officer
[A signed original of this written statement required by Section 906 has been provided to Cellteck, Inc. and will be retained by Cellteck, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.]
Exhibit 32.2
CERTIFICATIONS PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
In connection with the Quarterly Report of Cellteck, Inc., a Nevada corporation (the "Company"), on Form 10-Q for the quarter ended September 30, 2008, as filed with the Securities and Exchange Commission (the "Report"), Gus Rahim, Chief Financial Officer of the Company, does hereby certify, pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. ss.1350), that to his knowledge:
(1) The Report fully complies with the requirements of section 13(a)or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
November 18, 2008
/s/ Gus Rahim
Gus Rahim, Chief Financial Officer
[A signed original of this written statement required by Section 906 has been provided to Cellteck, Inc. and will be retained by Cellteck, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.]
Hopefully there is a little action today. If the ask got hit it would make a big difference in PPS post split. Overall I hope we start hearing some good news from the Co.
Thanks for setting it up!
Hopefully it does start moving now!
Is it trading? or just the quote? the $1.70 would have been nice.