UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended: August 31, 2002 Commission File Number 000-49908
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REXRAY CORPORATION
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(Exact name of registrant as specified in its charter)
COLORADO 75-3056237
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10077 E. County Line Road, Longmont, Colorado 80501
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(Address of principal executive offices) (Zip code)
(303) 772-3316
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(Registrant's telephone number, including area code)
(Former name, former address and former
fiscal year, if changed since last report.)
Indicate by check 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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common stock, no par value 1,160,000
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Class Number of shares outstanding
at October 11, 2002
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This document is comprised of 10 pages.
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INDEX
Page
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PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed balance sheet, August 31, 2002 (unaudited) ................. 3
Condensed statements of operations, three months ended
August 31, 2002 (unaudited) and May 2, 2002 (inception)
through August 31, 2002 (unaudited) ............................... 4
Condensed statements of cash flows, three months ended
August 31, 2002 (unaudited) and May 2, 2002 (inception)
through August 31, 2002 (unaudited) ............................... 5
Notes to unaudited condensed financial statements .................... 6
Item 2. Plan of Operation ........................................... 8
PART 2 - OTHER INFORMATION
Item 1. Legal Information ........................................... 9
Item 2. Changes in Securities ....................................... 9
Item 3. Defaults Upon Senior Securities ............................. 9
Item 4. Submission of Matters to a Vote of Security Holders ......... 9
Item 5. Other Information ........................................... 9
Item 6. Exhibits and Reports on Form 8-K ............................ 9
Signatures ........................................................... 10
Part 1. Item 1. Financial Information
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REXRAY CORPORATION
(A Development Stage Company)
Condensed Balance Sheet
(Unaudited)
August 31, 2002
Assets
Cash ............................................................ $ 811
========
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable and accrued liabilities .................... 750
--------
Total liabilities ............................. 750
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Shareholders' equity:
Preferred stock ............................................. --
Common stock ................................................ 11,600
Additional paid-in capital .................................. 1,245
Deficit accumulated during development stage ................ (12,784)
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Total shareholder's equity .................... 61
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$ 811
========
See accompanying notes to condensed financial statements
3
REXRAY CORPORATION
(A Development Stage Company)
Condensed Statements of Operations
(Unaudited)
May 2, 2002
Three Months (Inception)
Ended Through
August 31, August 31,
2002 * 2002
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Operating expenses:
Stock-based compensation:
Incorporation and organization services ... $ -- $ 8,000
Professional fees ............................ 1,535 3,035
Contributed services (Note 2) ................ 1,245 1,245
Rent, related party (Note 2) ................. 300 400
Other ........................................ 18 104
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Total operating expenses ...... 3,098 12,784
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Loss before income taxes ...... (3,098) (12,784)
Income tax provision (Note 3) .................... -- --
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Net loss ...................... $ (3,098) $ (12,784)
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Basic and diluted loss per share ................. $ (0.00)
===========
Basic and diluted weighted average
common shares outstanding .................... 1,156,667
===========
* The Company was incorporated on May 2, 2002; therefore, no comparative
period for the three months ended August 31, 2001 is presented.
See accompanying notes to condensed financial statements
4
REXRAY CORPORATION
(A Development Stage Company)
Condensed Statements of Cash Flows
(Unaudited)
May 2, 2002
Three Months (Inception)
Ended Through
August 31, August 31,
2002 * 2002
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Net cash used in
operating activities .......... $(1,103) $(2,789)
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Cash flows from financing activities:
Proceeds from the sale of common stock (Note 4) .... 200 3,600
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Net cash provided by
financing activities .......... 200 3,600
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Net change in cash ............ (903) 811
Cash, beginning of period .............................. 1,714 --
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Cash, end of period .................................... $ 811 $ 811
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Supplemental disclosure of cash flow information:
Income taxes ....................................... $ -- $ --
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Interest ........................................... $ -- $ --
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* The Company was incorporated on May 2, 2002; therefore, no comparative
period for the three months ended August 31, 2001 is presented.
See accompanying notes to condensed financial statements
5
REXRAY CORPORATION
(A Development Stage Company)
Notes to Unaudited Condensed Financial Statements
Note 1: Basis of Presentation
The condensed financial statements presented herein have been prepared by the
Company in accordance with the instructions for Form 10-QSB and the accounting
policies in its Form 10-SB for the period ended May 31, 2002 and should be read
in conjunction with the notes thereto.
In the opinion of management, the accompanying condensed financial statements
contain all adjustments (consisting only of normal recurring adjustments) which
are necessary to provide a fair presentation of operating results for the
interim periods presented. The results of operations presented for the three
months ended August 31, 2002 are not necessarily indicative of the results to be
expected for the year.
The Company is in the development stage in accordance with Statements of
Financial Accounting Standards (SFAS) No. 7 "Accounting and Reporting by
Development Stage Enterprises". As of August 31, 2002, the Company has devoted
substantially all of its efforts to financial planning and raising capital.
Financial data presented herein are unaudited.
Note 2: Related Party Transactions
The Company paid rent to Amery Coast Corporation, an affiliate under common
control, for all periods presented. The office space was valued at $100 per
month based on the market rate in the local area and is included in the
accompanying financial statements as rent, related party.
An officer contributed time and effort to the Company valued at $1,245 for the
three months ended August 31, 2002. The time and effort was valued by the
officers between $20 and $75 per hour based on the level of services performed
and is included in the accompanying condensed financial statements as
contributed services with a corresponding credit to additional paid-in capital.
Note 3: Income taxes
The Company records its income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes". The Company incurred net operating losses during
the three months ended August 31, 2002 resulting in a deferred tax asset, which
was fully allowed for; therefore, the net benefit and expense resulted in $-0-
income taxes.
Note 4: Shareholders' Equity
During the three months ended August 31, 2002, the Company sold 20,000 shares of
its common stock for $.01 per share. The Company relied upon exemptions from
registration believed by it to be available under federal and state securities
laws in connection with the sales. The shares were sold through the Company's
officer and director. The Company received proceeds from the offering totaling
$200.
6
REXRAY CORPORATION
(A Development Stage Company)
Notes to Unaudited Condensed Financial Statements
Following is a schedule of changes in shareholders' equity for the three months
ended August 31, 2002:
Deficit
Accumulated
Common Stock Additional During
----------------------- Paid-In Development
Shares Amount Capital Stage Total
---------- ---------- ---------- ---------- ----------
Balance at June 1, 2002 .................. 1,140,000 $ 11,400 $ -- $ (9,686) $ 1,714
Shares sold in private placement
offering at $.01 per share ........... 20,000 200 -- -- 200
Services contributed by an officer ....... -- -- 1,245 -- 1,245
Net loss for the three months
ended August 31, 2002 ................ -- -- (3,098) (3,098)
---------- ---------- ---------- ---------- ----------
Balance at May 31, 2002 .................. 1,160,000 $ 11,600 $ 1,245 $ (12,784) $ 61
========== ========== ========== ========== ==========
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Part I. Item 2. Plan of operation
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REXRAY CORPORATION
(A Development Stage Company)
PLAN OF OPERATION
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The Company intends to seek out, investigate, and pursue a merger, acquisition,
or other business combination with an operating entity. There have been no
revenues from operations since inception, and none are anticipated prior to
completing a business combination.
The Company has no full-time employees, incurs nominal rent and administrative
expenses of approximately $100 per month, and has no other recurring operational
expenses except professional fees incurred as necessary. The Company's president
devotes approximately ten hours per month, without compensation, to the affairs
of the Company. Should the Company not complete a business combination within
the next three to six months, the Company plans to raise additional working
capital through the sale of its common stock. There is no assurance that the
Company will be able to raise the capital needed to maintain its development
stage operations.
The Company has no plans to acquire any assets or make any investments prior to
completing a business combination.
To date, the Company has not identified a suitable target entity for any type of
business combination, and management has no particular type of merger,
acquisition, or business opportunity in mind. No restrictions have been placed
on management's discretion to seek out and participate in an appropriate
business opportunity. Due to limited financial resources, it is anticipated that
only a single potential business venture will be pursued.
Selection of an appropriate business opportunity is complex and risky due to the
Company's limited financial resources, the speculative nature of operations,
management's limited time commitment to the Company, management's potential
conflicts of interest, the burdens of being a reporting company, lack of market
research, and competition in the marketplace. The Company's success is dependent
upon locating and consummating a business combination, and there are no
assurances that this will occur.
Special note regarding forward-looking statements
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This report contains forward-looking statements within the meaning of federal
securities laws. These statements plan for or anticipate the future.
Forward-looking statements include statements about our future business plans
and strategies, statements about our need for working capital, future revenues,
results of operations and most other statements that are not historical in
nature. In this Report, forward-looking statements are generally identified by
the words "intend", "plan", "believe", "expect", "estimate", and the like.
Investors are cautioned not to put undue reliance on forward-looking statements.
Except as otherwise required by applicable securities statues or regulations,
the Company disclaims any intent or obligation to update publicly these
forward-looking statements, whether as a result of new information, future
events or otherwise. Because forward-looking statements involve future risks and
uncertainties, these are factors that could cause actual results to differ
materially from those expressed or implied.
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Part 2. Other Information
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REXRAY CORPORATION
(A Development Stage Company)
Item 1 - Legal Information.
No response required.
Item 2 - Changes in Securities.
No response required.
Item 3 - Defaults Upon Senior Securities.
No response required.
Item 4 - Submission of Matters to a Vote of Security Holders.
No response required.
Item 5 - Other Information.
No response required.
Item 6 - Exhibits and Reports on Form 8-K.
(a) Exhibits:
1. 99.1: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 - CEO
2. 99.2: Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 - CFO
(b) Reports on Form 8-K:
None.
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SIGNATURES
The financial information furnished herein has not been audited by an
independent accountant; however, in the opinion of management, all adjustments
(only consisting of normal recurring accruals) necessary for a fair presentation
of the results of operations for the three months ended August 31, 2002 have
been included.
Pursuant to the requirements 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.
REXRAY CORPORATION
(Registrant)
DATE: October 14, 2002 BY: /s/ James B. Wiegand
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James B. Wiegand
President
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