10QSB/A: AMERICAN SECURITY RESOURCES CORP.
11:32 a.m. 05/15/2006 Provided by
(EDGAR Online via COMTEX) -- Item 2 - Management's Discussion and Analysis and Plan of Operation
Plan of Operation.
Management continues to provide funding and oversight to the Company's wholly-owned subsidiary, Hydra Fuel Cell Corp. During the first quarter, management raised over $750,000 through private placements of the Company's common stock to fund the development of the HydraStaxTM fuel cells which employ the Company's proprietary technology. Management expects to continue the funding of its fuel cell business through placements of its stock.
Management continues to review acquisition opportunities that would enhance its fuel cell offerings, expand its offerings in alternative energy production or represent opportunities in homeland security or national defense.
Management's Discussion and Analysis Results of Operations and Financial Condition
The Company had no revenues for the quarter ended March 31, 2005 and 2006.
The Company incurred $2,472,400 of general and administrative expenses for the three months ended March 31, 2006 as compared with $44,610 for the same period in 2005. In addition, the Company incurred $330,255 in research and development costs in its Hydra Fuel Cell subsidiary relating to the development of its HydraStax hydrogen fuel cell. These expenses include $2,273,084 of stock issued for compensation to outside vendors, contractors and certain officers and directors.
The Company had a net loss of $2,802,655, or $0.04 per share, for the three months ended March 31, 2006; as compared with a net loss of $44,610, or $0.00 per share for the three months ended March 31, 2005.
At March 31,2006, the Company had $412,130 of cash and cash equivalents.
CONTROLS AND PROCEDURES
Disclosure Controls and Procedures. The Company's management, with the participation of the Company's Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company's Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company's disclosure controls and procedures are not effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act, except that adjustments were required by our auditors in their review. We are reviewing our accounting procedures to ensure that future adjustments are not required.
Internal Control Over Financial Reporting. There have not been any changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
PRECAUTIONARY STATEMENT
This form 10-QSB contains statements which constitute forward-looking statements within the meaning of Section 27A of the Securities Act, as amended and Section 21E of the Securities Exchange Act of 1934. The words expect, anticipate, believe, goal, plan, intend, estimate, and similar expressions and variations thereof, if used, are intended to specifically identify forward-looking statements. Those statements appear in a number of places in this Form 10-QSB and in other places, particularly, Management's Discussion and Analysis of Financial Condition and Results of Operations, and include statements regarding our intent, belief or current expectations of our Company, our directors or officers with respect to, among other things: (i) our liquidity and capital resources; (ii) our financing opportunities and plans and (iii) our future performance and operating results. Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. The factors that might cause such differences include, among others, the following: (i) any material inability of us to successfully internally develop our products; (ii) any adverse effect or limitations caused by governmental regulations; (iii) any adverse effect on our continued positive cash flow and our abilities to obtain acceptable financing in connection with our growth plans; (iv) any increased competition in business;
May 15, 2006
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