x
|
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the quarter ended October 31, 2007
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¨
|
TRANSITION
REPORT UNDER SECTION 13 OR 15 (d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from
_______to_______
|
Nevada
|
88-0448626
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(State
or other jurisdiction of
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(IRS
Employer
|
incorporation
or organization)
|
Identification
No.)
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Page
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||
Condensed
Balance Sheet at October 31, 2007
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F-2
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|
Condensed
Statement of Operations for the three and nine months
ended
|
||
October
31, 2007, three and nine months ended October 31, 2006,
|
||
and
from May 11, 2004 (Inception) through October 31, 2007
|
F-3
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|
Condensed
Statement of Changes in Shareholders' Deficit for the period
from
|
||
May
11, 2004 (Inception) through October 31, 2007
|
F-4
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|
Condensed
Statement of Cash Flows for the nine months ended October 31,
2007,
|
||
nine
months ended October 31, 2006, and from May 11, 2004
(Inception)
|
||
through
October 31, 2007
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F-5
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|
Notes
to Financial Statements
|
F-6
|
|
Item
2. Plan of Operation
|
13
|
|
Part
II – Other Information
|
14
|
|
Signatures
|
16
|
|
Assets
|
||||
Cash
|
$ |
22,437
|
||
Total
assets
|
$ |
22,437
|
||
Liabilities
and Shareholders’ Deficit
|
||||
Current
liabilities:
|
||||
Accounts
and notes payable:
|
||||
Accounts
payable, related party (Note 2)
|
$ |
323,725
|
||
Accounts
payable, other
|
254,777
|
|||
Notes
payable, related party (Note 2)
|
400,639
|
|||
Notes
payable, other (Note 4)
|
30,000
|
|||
Accrued
interest payable:
|
||||
Notes
payable, related party (Note 2)
|
39,842
|
|||
Notes
payable, other (Note 4)
|
6,312
|
|||
Total
current liabilities
|
1,055,295
|
|||
Commitments
and contingencies
|
—
|
|||
Shareholders’
deficit:
|
||||
Preferred
stock, $.01 par value; 100,000 shares authorized,
|
||||
-0-
shares issued and outstanding
|
—
|
|||
Common
stock, $.001 par value; 50,000,000 shares authorized,
|
||||
16,035,219
shares issued and outstanding
|
16,035
|
|||
Additional
paid-in capital
|
1,447,047
|
|||
Deficit
accumulated during the development stage
|
(2,495,940 | ) | ||
Total
shareholders' deficit
|
(1,032,858 | ) | ||
Total
liabilities and shareholders' deficit
|
$ |
22,437
|
Deficit
|
||||||||||||||||||||
Additional
|
accumulated
|
|||||||||||||||||||
Common
Stock
|
paid-in
|
during
the
|
||||||||||||||||||
Shares
|
Par
value
|
capital
|
development
stage
|
Total
|
||||||||||||||||
Balance
at May 11, 2004
|
||||||||||||||||||||
Inception
date
|
—
|
$ |
—
|
$ |
—
|
$ |
—
|
$ |
—
|
|||||||||||
October
2004 and January 2005,
|
||||||||||||||||||||
sale
of common stock
|
9,555,100
|
9,555
|
269,945
|
—
|
279,500
|
|||||||||||||||
October
2004, issuance of common stock
|
||||||||||||||||||||
for
debt issue costs
|
963,000
|
963
|
(63 | ) |
—
|
900
|
||||||||||||||
December
2004, issuance of common stock
|
||||||||||||||||||||
for
services
|
107,000
|
107
|
893
|
—
|
1,000
|
|||||||||||||||
January
2005, conversion of notes payable to
|
||||||||||||||||||||
common
stock
|
74,900
|
75
|
625
|
—
|
700
|
|||||||||||||||
Net
loss
|
—
|
—
|
—
|
(534,619 | ) | (534,619 | ) | |||||||||||||
Balance
at January 31, 2005
|
10,700,000
|
10,700
|
271,400
|
(534,619 | ) | (252,519 | ) | |||||||||||||
February
2005 and March 2005,
|
||||||||||||||||||||
sale
of common stock
|
428,000
|
428
|
99,572
|
—
|
100,000
|
|||||||||||||||
May 2005
Reverse acquisition of Organic
|
||||||||||||||||||||
Soils.com,
Inc.
|
2,323,000
|
2,323
|
(47,179 | ) | (44,856 | ) | ||||||||||||||
Net
loss
|
—
|
—
|
—
|
(664,190 | ) | (664,190 | ) | |||||||||||||
Balance
at January 31, 2006
|
13,451,000
|
13,451
|
323,793
|
(1,198,809 | ) | (861,565 | ) | |||||||||||||
July
2006 and August 2006,
|
||||||||||||||||||||
sale
of common stock, less
|
||||||||||||||||||||
$7,500
of offering costs
|
250,000
|
250
|
67,250
|
—
|
67,500
|
|||||||||||||||
Net
loss
|
(527,029 | ) | (527,029 | ) | ||||||||||||||||
Balance
at January 31, 2007
|
13,701,000
|
13,701
|
391,043
|
(1,725,838 | ) | (1,321,094 | ) | |||||||||||||
March
2007, conversion of
|
||||||||||||||||||||
convertible
promissory notes to
|
||||||||||||||||||||
common
stock (Note 3)
|
594,356
|
594
|
213,374
|
—
|
213,968
|
|||||||||||||||
Issuance
of warrants upon conversion
|
||||||||||||||||||||
of
convertible promissory notes (Note 3)
|
—
|
—
|
172,363
|
—
|
172,363
|
|||||||||||||||
March
2007, sale of common stock
|
||||||||||||||||||||
(Note
7)
|
500,000
|
500
|
124,500
|
—
|
125,000
|
|||||||||||||||
April
2007, sale of common stock,
|
||||||||||||||||||||
less
$3,000 of offering costs (Note 7)
|
100,000
|
100
|
26,900
|
—
|
27,000
|
|||||||||||||||
July
2007, conversion of
|
||||||||||||||||||||
convertible
promissory notes to
|
||||||||||||||||||||
common
stock (Note 3)
|
489,863
|
490
|
183,209
|
—
|
183,699
|
|||||||||||||||
Issuance
of warrants upon conversion
|
||||||||||||||||||||
of
convertible promissory notes (Note 3)
|
—
|
—
|
151,368
|
—
|
151,368
|
|||||||||||||||
July
2007, sale of common stock (Note 7)
|
200,000
|
200
|
49,800
|
—
|
50,000
|
|||||||||||||||
August
2007, sale of common stock (Note 7)
|
250,000
|
250
|
74,720
|
74,970
|
||||||||||||||||
October
2007, sale of common
|
||||||||||||||||||||
stock
(Note 7)
|
200,000
|
200
|
59,770
|
59,970
|
||||||||||||||||
Net
loss
|
—
|
—
|
—
|
(770,102 | ) | (770,102 | ) | |||||||||||||
Balance
at October 31, 2007
|
16,035,219
|
$ |
16,035
|
$ |
1,447,047
|
$ | (2,495,940 | ) | $ | (1,032,858 | ) |
May
11, 2004
|
||||||||||||
Nine
months
|
Nine
months
|
(Inception)
|
||||||||||
ended
|
ended
|
Through
|
||||||||||
October
31,
|
October
31,
|
October
31,
|
||||||||||
2007
|
2006
|
2007
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
loss
|
$ | (770,102 | ) | $ | (392,593 | ) | $ | (2,495,940 | ) | |||
Adjustments
to reconcile net loss to net cash
|
||||||||||||
used
by operating activities:
|
||||||||||||
Stock
based compensation
|
—
|
—
|
1,000
|
|||||||||
Loss
on debt extinguishment (Note 3)
|
126,612
|
—
|
126,612
|
|||||||||
Expense
incurred upon issuance or modification
|
||||||||||||
of
stock and warrants (Note 3)
|
323,731
|
—
|
323,731
|
|||||||||
Changes
in operating assets and liabilities:
|
||||||||||||
Prepaid
expense
|
—
|
—
|
—
|
|||||||||
Accounts
payable
|
22,836
|
111,794
|
254,777
|
|||||||||
Related
party payables (Note 2)
|
64,850
|
96,750
|
323,725
|
|||||||||
Accrued
expenses
|
13,269
|
26,687
|
92,210
|
|||||||||
Net
cash used in
|
||||||||||||
operating
activities
|
(218,804 | ) | (157,362 | ) | (1,373,885 | ) | ||||||
Cash
flows from investing activities:
|
||||||||||||
Investment
in Inhibitex Therapeutics, Inc.
|
—
|
—
|
(44,856 | ) | ||||||||
Net
cash used in
|
||||||||||||
investing
activities
|
—
|
—
|
(44,856 | ) | ||||||||
Cash
flows from financing activities:
|
||||||||||||
(Payments
on) proceeds from related party notes
|
||||||||||||
payable,
net (Note 2)
|
(95,840 | ) |
76,419
|
389,238
|
||||||||
Proceeds
from notes payable, other
|
—
|
13,000
|
43,000
|
|||||||||
Proceeds
from convertible promissory note (Note 3)
|
—
|
—
|
225,000
|
|||||||||
Proceeds
from issuance of common stock,
|
||||||||||||
net
of offering costs (Note 7)
|
336,940
|
67,500
|
783,940
|
|||||||||
Net
cash provided by
|
||||||||||||
financing
activities
|
241,100
|
156,919
|
1,441,178
|
|||||||||
Net
change in cash and
|
||||||||||||
cash
equivalents
|
22,296
|
(443 | ) |
22,437
|
||||||||
Cash
and cash equivalents:
|
||||||||||||
Beginning
of period
|
141
|
747
|
—
|
|||||||||
End
of period
|
$ |
22,437
|
$ |
304
|
$ |
22,437
|
||||||
Supplemental
disclosure of cash flow information:
|
||||||||||||
Cash
paid during the period for:
|
||||||||||||
Income
taxes
|
$ |
—
|
$ |
—
|
$ |
—
|
||||||
Interest
|
$ |
18,323
|
$ |
14,669
|
$ |
38,430
|
||||||
Noncash
financing transactions:
|
||||||||||||
Notes
and interest payable converted to stock
|
$ |
271,055
|
$ |
—
|
$ |
271,755
|
||||||
Stock
issued in exchange for debt issue costs
|
$ |
—
|
$ |
—
|
$ |
900
|
||||||
Management
fees payable to officers
|
$ |
305,400
|
||
Rent
payable to company affiliated with officers
|
18,325
|
|||
Total
accounts payable, related party
|
$ |
323,725
|
Notes
payable to officers; interest at 8% and due on demand
|
$ |
671
|
||
Notes
payable to affiliates of Company officers; interest at 8% and due
on
demand
|
386,968
|
|||
Note
payable to significant stockholder; interest at 8% and due on
demand
|
13,000
|
|||
Notes
payable, related party
|
400,639
|
|||
Interest
payable related party
|
39,842
|
|||
Total
principal and interest payable, related party
|
$ |
466,318
|
Issuance
Date
|
Fair
Value
|
Term
|
Exercise
Price
|
Market
Price on Grant Date
|
Volatility
Percentage
|
Interest
Rate
|
April
2007
|
$172,363
|
3
years
|
$0.50
|
$0.36
|
156%
|
4.5%
|
July
2007
|
$151,368
|
3
years
|
$0.50
|
$0.375
|
161%
|
4.5%
|
Three
months ended October 31, 2007
|
Three
months ended October 31, 2006
|
Nine
months ended October 31, 2007
|
Nine
months ended October 31, 2006
|
May
11, 2004 (Inception) through October 31, 2007
|
||||||||||||||||
General
and administrative
|
$ |
871
|
$ |
686
|
$ |
3,381
|
$ |
1,569
|
$ |
19,213
|
||||||||||
Legal
and accounting
|
1,683
|
4,386
|
8,236
|
26,118
|
75,189
|
|||||||||||||||
Loss
on debt extinguishment
|
-
|
-
|
126,612
|
-
|
126,612
|
|||||||||||||||
Professional
services
|
23,100
|
600
|
29,400
|
1,800
|
169,109
|
|||||||||||||||
Stock
based compensation
|
-
|
-
|
-
|
-
|
1,000
|
|||||||||||||||
$ |
25,654
|
$ |
5,672
|
$ |
167,629
|
$ |
29,487
|
$ |
391,123
|
Exhibits:
|
|
31.1
|
CEO
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
32.1
|
CEO
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
INHIBITON
THERAPEUTICS, INC.
|
|
(Registrant)
|
Date:
December 14, 2007
|
By:
/s/ Henry Fong
|
Henry
Fong
|
|
Principal
Executive Officer and
Principal
Financial Officer
|
|