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Eneftech Corp · 10KSB · For 12/31/04

Filed On 4/15/05 11:37am ET   ·   SEC File 814-00681   ·   Accession Number 939802-5-148

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  As Of               Filer                 Filing     As/For/On Docs:Pgs              Issuer               Agent

 4/15/05  Eneftech Corp                     10KSB      12/31/04    3:28                                     Robison Hill & Co

Annual Report -- Small Business   ·   Form 10-KSB
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10KSB       Annual Report -- Small Business                       25    101K 
 2: EX-31       Certification per Sarbanes-Oxley Act (Section 302)     2±    11K 
 3: EX-32       Certification per Sarbanes-Oxley Act (Section 906)     1      6K 


10KSB   ·   Annual Report -- Small Business
Document Table of Contents

Page (sequential) | (alphabetic) Top
 
11st Page
4Item 1. Description of Business
5Item 2. Description of Property
"Item 3. Legal Proceedings
"Item 4. Submission of Matters to a Vote of Security Holders
6Item 5. Market for Common Equity and Related Stockholder Matters
"Penny Stock
7Item 6. Management's Discussion and Analysis or Plan of Operation
9Item 7. Financial Statements
"Item 8. Changes in and Disagreements With Accountants
10Item 8a. Controls and Procedures
"Item 8b. Other Information
"Item 9. Directors, Executive Officers, Promoters, and Control Persons; Compliance With Section 16(C) of the Exchange Act
11Item 11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
12Item 12. Certain Relationships and Related Transactions
"Item 13. Exhibits and Reports on Form 8-K
13Item 14. Principal Accountant Fees and Services
14Independent Auditor's Report
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SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K Annual Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2004 Commission File Number: 814-00681 ENEFTECH CORPORATION --------------------------------------------------- (Name of Small Business Issuer in its charter) Texas 76-0676166 ------------------------ ---------------------------- (State of Incorporation) (I.R.S. Employer I.D. Number) ------------------------------------------------ (Address of principal executive offices) P.O. Box 6162, Burbank, CA 91510 ------------------------------------------------ (United States mailing address) 949-862-5834 ------------------------------- Issuer's telephone number Securities registered under Section 12(b) of the Act: NONE Securities registered under Section 12(g) of the Act: COMMON STOCK Check whether the issuer (1) filed all reports required to be filed by Sections 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [ ]Yes [x]No
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Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation contained in this form, and no disclosure will be contained, to the best of issuer's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [ ] The issuer's revenues for the period ended December 31, 2004. None The aggregate market value of the voting and non-voting common equity held by non-affiliates based on the average bid and asked price of such common equity, as of December 31, 2004 was $0. The number of shares outstanding of each of the issuer's classes of such common equity, as of December 31, 2004 was 3,040,000 shares. Transitional Small Business Disclosure Format (check one): Yes___; No_X_
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FORM 10-K YEAR ENDED DECEMBER 31, 2004 TABLE OF CONTENTS PART I Item 1. DESCRIPTION OF BUSINESS............................................4 Item 2. DESCRIPTION OF PROPERTIES..........................................5 Item 3. LEGAL PROCEEDINGS..................................................5 Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................5 PART II Item 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS............................................6 Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION..............................................7 Item 7. FINANCIAL STATEMENTS...............................................9 Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.........................9 Item 8a. CONTROLS AND PROCEDURES............................................10 Item 8b. OTHER INFORMATION..................................................10 PART III Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT...................................................10 Item 10. EXECUTIVE COMPENSATION..............................................10 Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.....................11 Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS......................12 Item 13. EXHIBITS AND REPORTS ON FORM 8-K....................................12 Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES..............................13
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PART I ITEM 1. DESCRIPTION OF BUSINESS ORGANIZATION AND GENERAL HISTORY Eneftech Corporation ("Eneftech", the Issuer" or "the Company") was incorporated on April 2, 2001 under the laws of the State of Texas under the name ILN Barrington Corporation to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. Unless the context otherwise requires, all references to "the Company" "we" "our" "us" and other similar terms means Eneftech Corporation. Pursuant to an Agreement and Plan of Reorganization dated October 25, 2001 (the "Plan"), we acquired all the assets of Eneftech Group, a California Partnership, and commenced the business operations formerly conducted by Eneftech Group. Subsequently, we changed our name from ILN Barrington Corporation to Eneftech Corporation on October 29, 2001. Effective as of 11:59 pm on 12/31/03 the Board of Directors of the Company accepted the resignation of Mary-Jean Buerer as Chief Executive Officer of the corporation and El Hadj Malick Kane as Chief Operating Office effective as of 11:59 pm on 12/31/02. Effective as of 12:01 am on 1/1/04 the Board of Directors of the Company appointed Stephen Stotesbery as a director and as Chief Executive Officer of the corporation until the next annual meeting of stockholders and/or until a successor is elected and has qualified, or until such officer's earlier death, resignation or removal. Effective May 10, 2004, as reported in a Form 8-K filed on June 24, 2004, the Board of Directors of the Company accepted the return of 30,000,000 shares of restricted and unregistered shares of the $0.0001 par value common stock of the Company originally issued to Mary-Jean Buerer, Meinrad Buerer, and El Hadj Malick Kane, for the acquisition of the assets of Eneftech Group, rescinding the acquisition transaction, and 4,000,000 shares previously to ILN INDUSTRIES LLC. for reinstatement as issuable. As a result of these cancellations, the issued and outstanding shares of the common stock of the Company was reduced to 3,040,000. Also on May 10, 2004, three of the existing directors of the Company, Mary-Jean Buerer, Meinrad Buerer and El Hadj Malick Kane, resigned as directors of the Company and Parrish Whitaker and Terence M. O'Keefe were appointed as directors along with Stephen R. Stotesbery. Mr. Stotesbery was appointed as President and Secretary and Mr. Whitaker was appointed as Chairman. The change of officers and directors was reported on Form 8-K filed with the SEC on June 24, 2004. As reported on Form 8-K filed with the SEC on August 20, 2004, Parrish Whitaker resigned as an officer and director of the Company effective August 5, 2004. On October 26, 2004, Stanley Hirschman and Phil Pearce were appointed as new directors of the Company, to serve with Mr. Stotesbery and Mr. O'Keefe. Their appointment was reported in a Form 8-K filed with the SEC on November 5, 2004. 4
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In August, 2004, the Company announced an agreement to merge with iWorld Projects & Systems, Inc., a privately held Florida corporation, as reported on a Form 8-K filed with the SEC on August 20, 2004. Subsequently, the closing of the merger was postponed indefinitely because the Company was unable to obtain timely audited financial statements from its then independent auditors. The postponement was announced in a Form 8-K filed on October 15, 2004. Thereafter, the proposed merger with iWorld Projects & Systems, Inc. was cancelled, as reported on Form 8-K filed on March 18, 2005. On November 1, 2004, the Company filed an election with the SEC on Form N54-A to be a business development company under the Investment Company Act of 1940. No investments in any portfolio companies have yet been made by the Company. BUSINESS OF ISSUER As a result of the acquisition of the assets of Eneftech Group, we planned to engage in the business of distributed power, heating and cooling generation for industrial, commercial and residential customers. The technology acquired by us, based on Organic Rankine Cycles, would allow capitalization on the poorly exploited niche market of small-scale power generation units (less than 50kW elec.), as well as low temperature waste heat. With the abandoned of that business plan in May, 2004, the business of the Company became searching for and locating merger partners with operating businesses, and, after November 1, 2004, to act as a business development Company under the Investment Company Act of 1940. No operations or other business activity occurred through the end of December 2004. EMPLOYEES As of December 31, 2004, we had no employees. ITEM 2. DESCRIPTION OF PROPERTY. During 2004, we used the office of management, at no cost to the Company located at Burbank, California. ITEM 3. LEGAL PROCEEDINGS. We are not a party to any pending legal proceedings. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. No matters were submitted to a vote of security holders during 2004. 5
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PART II ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. As of December 31, 2004, there was no market for our common equity. HOLDERS There were 21 holders of our common stock as of December 31, 2004. DIVIDENDS We have not paid any cash dividends to date and do not anticipate paying dividends on our common stock in the foreseeable future. Future dividends, if any, will depend upon our earnings, if any, and subscribers who anticipate the need of cash dividends from their investment should refrain from the purchase of the Shares being offered. PENNY STOCK Our securities may be deemed to be "penny stock" as defined in Rule 3a51-1 of the Securities and Exchange Commission. This designation may have an adverse effect on the development of any public market for our shares of common stock or, if such a market develops, its continuation, as broker-dealers are required to personally determine whether an investment in the securities is suitable for customers prior to any solicitation of any offer to purchase these securities. Penny stocks are securities (i) with a price of less than five dollars per share; (ii) that are not traded on a "recognized" national exchange; (iii) whose prices are not quoted on the NASDAQ automated quotation system (NASDAQ-listed stocks must still meet requirement (i)above); or (iv) of an issuer with net tangible assets less than $2,000,000 (if the issuer has been in continuous operation for at least three years) or $5,000,000 (if in continuous operation for less than three years), or with average annual revenues of less than $6,000,000 for the last three years. Section 15(g) of the Securities Exchange Act of 1934, as amended, and Rule 15g-2 of the Securities and Exchange Commission require broker-dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document before effecting any transaction in a penny stock for the investor's account. Potential investors in our common stock are urged to obtain and read such disclosure carefully before purchasing any shares that are deemed to be "penny stock." Further, Rule 15g-9 of the Securities and Exchange Commission requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to (i) obtain from the investor 6
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information concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii)above; and (iv) receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor's financial situation, investment experience and investment objectives. Compliance with these requirements may make it more difficult for purchasers of the Issuer's common stock to resell their shares to third parties or to otherwise dispose of them. RECENT SALES OF UNREGISTERED SECURITIES During 2004, we did not sell any securities which were not registered. TRANSFER AGENT AND REGISTRAR Our transfer agent is PublicEase, 3663 E. Sunset Road, Suite 104, Las Vegas, NV 89120. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION During 2004, we abandoned our plan to design and produce economical small-scale units, featuring the the conversion of hermetic scroll compressors into turbines and the designing of a multi-fuel boiler, due to lack of operating funds. Our business model then became one of locating a suitable merger partner, and later, to acting as a business development company. Again, due to lack of funds, we were unable to implement this plan, and engaged in no business activity in 2004. SERVICES TO BE OFFERED We plan to provide management services to portfolio companies which we identify and in which we invest. To date, no portfolio companies have been identified and we have no funds to make any investments. RISK FACTORS LIMITED OPERATING HISTORY We have only a limited operating history upon which an evaluation of our Company and our prospects can be based. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly companies in new and rapidly evolving markets. To address these risks, we must, among other things, respond to competitive developments. There can be no assurance that our Company will be successful in addressing such risks. 7
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FUTURE CAPITAL REQUIREMENTS We presently have no operating capital. We will require substantial additional funding in order to realize our goals of commencing nationwide marketing of our products and services. Depending upon the growth of our business operations, and the acceptance of our products and services, we will need to raise substantial additional funds through equity or debt financing, which may be very difficult for such a speculative enterprise. There can be no assurance that such additional funding will be made available to us, or if made available, that the terms thereof will be satisfactory to our Company. Furthermore, any equity funding will cause a substantial decrease in the proportional ownership interests of existing stockholders. LIMITED MARKET FOR COMMON STOCK Limited Market for Shares. Any market price that may develop for shares of common stock of our Company is likely to be very volatile, and factors such as success or lack thereof in developing and marketing our products and services, competition, governmental regulation and fluctuations in operating results may all have a significant effect. In addition, the stock markets generally have experienced, and continue to experience, extreme price and volume fluctuations which have affected the market price of many small capital companies and which have often been unrelated to the operating performance of these companies. These broad market fluctuations, as well as general economic and political conditions, may adversely affect the market price of our Company's common stock in any market that may develop. FUTURE SALES OF COMMON STOCK There is presently no market for the shares of our common stock. See the Risk Factor "Limited Market for Common Stock; Limited Market for Shares," above. Future sales of securities pursuant to Rule 144 of the Securities and Exchange Commission may have an adverse impact on any market which may develop in our securities. Presently, Rule 144 requires a one year holding period prior to public sale of "restricted securities" in accordance with this Rule; the Directors could each sell (i) an amount equal to 1% of the total outstanding securities of the Issuer in any three month period or (ii) the average weekly reported volume of trading in such securities on all national securities and exchanges or reported through the automated quotation system of a registered securities association during the four calendar weeks preceding the filing of notice under Rule 144 (this computation is not available to OTC Bulletin Board companies). DEPENDENCE ON KEY PERSONNEL Our performance is substantially dependent on the performance of our executive officers and key employees. Given our early stage of development, we are dependent on our ability to retain and motivate high quality personnel, especially its current management. We do not have a "key person" life insurance policy on any of our employees. The loss of the services of any of our executive officers or other key employees could have a material adverse effect on the business, operating results or financial condition of our Company. 8
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INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS The Bylaws of our Company provide for indemnification to the fullest extent allowed under the Texas Business Corporations Act. Generally, under this Act, a corporation has the power to indemnify any person who is made a party to any civil, criminal, administrative or investigative proceeding, other than action by or any right of the corporation, by reason of the fact that such person was a director, officer, employee or agent of the corporation, against expenses, including reasonable attorney's fees, judgments, fines and amounts paid in settlement of any such actions; provided, however, in any criminal proceeding, the indemnified person shall have had no reason to believe the conduct committed was unlawful. It is the position of the Securities and Exchange Commission that indemnification against liabilities for violations of the federal securities laws, rules and regulations is against public policy. FORWARD LOOKING STATEMENTS In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the previous discussion and elsewhere in this report and in any other statement made by, or on behalf of our Company, whether or not in future filings with the Securities and Exchange Commission. Forward looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our Company's control and many of which, with respect to future business decisions, are subject to change. Theseuncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on behalf of, our Company. We disclaim any obligation to update forward looking statements. ITEM 7. FINANCIAL STATEMENTS. The financial statements of the Company and supplementary data are included preceding the signature page to this report. See Item 13. for a list of the financial statements and financial statement schedules included. ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS. The firm of Mendoza Berger Company, LLP acted as the Company's independent auditor in connection with the audit of its financial statements for 2002 and 2003 and the review of its reports of Forms 10-K for 2002 and 2003 and on Forms 10-Q for the interim quarterly periods through September 30, 2004. On March 17, 2005, the Company filed a report on Form 8-K reporting that it had terminated its relationship with Mendoza Berger Company and had retained the firm Robison, Hill Company as its independent auditors. As reported on the Form 8-K, there were no disagreements with the former auditors over accounting policy or the reporting of any material accounting matter. 9
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ITEM 8A. CONTROLS AND PROCEDURES Our Chief Executive Officer and Chief Financial Officer (the "Certifying Officer") is responsible for establishing and maintaining disclosure controls and procedures and internal controls and procedures for financial reporting for the Company. The Certifying Officer has designed such disclosure controls and procedures and internal controls and procedures for financial reporting to ensure that material information is made known to him, particularly during the period in which this report was prepared. The Certifying Officer has evaluated the effectiveness of the Company's disclosure controls and procedures and internal controls and procedures for financial reporting as of December 31, 2003 and believes that the Company's disclosure controls and procedures and internal controls and procedures for financial reporting are effective based on the required evaluation. There have been no significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. ITEM 8B. OTHER INFORMATION None. PART III ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(C) OF THE EXCHANGE ACT MANAGEMENT DURING 2004 · Download Table Names Title or Position Ages Stephen Stotesbery President/Secretary, CEO and Director 37 Terence O'Keefe Director 35 Stanley Hirschman Director 58 Phil Pearce Director 74 ITEM. 10. EXECUTIVE COMPENSATION None of the executive officer's salary and bonus exceeded $100,000 during our last fiscal year. No officer or director received any compensation in 2004 2001 STOCK INCENTIVE PLAN We had registered 2,500,000 shares on Form S-8 pursuant the Securities Act of 1933. The purpose of the plan is to assist in attracting and retaining key employees, non-employee directors and consultants to act as an incentive in motivating key employees, non-employee directors, legal counsel, and consultants to our Company to achieve long-term corporate objectives. 10
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The Plan WAS approved by the Board of Directors (hereinafter referred to as the "Board") of our company, to be effective October 26, 2001. The Plan is intended to be a broad based plan which all employees of our Company are eligible for, and grants to be made to management personnel and members of the Board shall not exceed 50% of the total number of shares issuable under the Plan. ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth certain information regarding the beneficial ownership of our Company's Common Stock as of December 31, 2004 based on information available to our Company by (I) each person who is known by our Company to own more than 5% of the outstanding Common Stock based upon reports filed by such persons within the Securities and Exchange Commission; (ii) each of our Company's directors; (iii) each of the Named Executive Officers; and (iv) all officers and directors of our Company as a group. · Download Table TITLE OF NAME AND ADDRESS OF AMOUNT OF SHARES PERCENT CLASS BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS ----------------------------------- (COMMON SHARES) Common El Hadj Malick Kane, Director 350,000 11.5% Stock 15, avenue des Oiseaux 1018 Lausanne, Switzerland ----------------------------------- Common Mary Jean Buerer, 350,000 11.5% Stock President/Treasurer/Director 5 Grand Rue 1315 La Sarraz Switzerland ----------------------------------- Common Meinrad Buerer, Secretary/Director 350,000 11.5% Stock 5 Grand Rue 1315 La Sarraz Switzerland ----------------------------------- Common Henry L. Jan, Shareholder 1,345,500 44.2% Stock 15007 Grove Gardens Houston, TX 77082 ----------------------------------- --------------- ------ 11
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ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. On October 25, 2001, we issued the general partners of Eneftech Group 30,000,000 shares for all of the assets and liabilities of Eneftech Group, a California General Partnership, in a reorganization within the meaning of Section 368(a)(1)(c) of the Internal Revenue Code of 1986, as amended. The 30,000,000 shares were returned to the Company during 2004. On October 25, 2001, we issued ILN Industries, LLC a total of 5,000,000 shares of common stock pursuant to Section 4(2) of the Securities Act for the consideration of $1,000. During 2004, 4,000,000 shares were returned to the Company. ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K. A) EXHIBITS EXHIBITS 2.1.* Agreement and Plan of Reorganization between Eneftech Group and ILN Barrington Corporation (incorporated by reference to Form 8-K/A filed on 2/05/2002). 3.1.* Articles of Incorporation of ILN Barrington Corporation (incorporated by reference to Form 10SB12G filed on 5/08/2001). 3.2.* Bylaws of ILN Barrington Corporation (incorporated by reference to Form 10SB12G, filed on 5/08/2001). 3.3.* Certificate of Amendment to Articles of Incorporation of ILN Barrington Corporation (incorporated by reference to Form 8-K/A filed on 2/05/2002). 31 Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act 32 Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act ** Summaries of all Exhibits contained within this Registration Statement are modified in their entirety by reference to these Exhibits. * Exhibits were previously filed. (B) REPORTS ON FORM 8-K Reports on Form 8-K during the fourth quarter of 2004. 12
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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The following is a summary of the fees billed to us by Robison, Hill & Company for professional services rendered for the years ended December 31, 2004: Service 2004 ------------------------------------------- ---------------------- Audit Fees $ - Audit-Related Fees - Tax Fees - All Other Fees - ---------------------- Total $ - ====================== AUDIT FEES - Consists of fees billed for professional services rendered for the audits of our financial statements, reviews of our interim financial statements included in quarterly reports, services performed in connection with filings with the Securities & Exchange Commission and related comfort letters and other services that are normally provided by Robison, Hill & Company in connection with statutory and regulatory filings or engagements. TAX FEES - Consists of fees billed for professional services for tax compliance, tax advice and tax planning. These services include assistance regarding federal, state and local tax compliance and consultation in connection with various transactions and acquisitions. Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors The Audit Committee, is to pre-approve all audit and non-audit services provided ny the independent auditors. These services may include audit services, audit related services, tax services and other services as allowed by law or regulation. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specifically approved amount. The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided bythe independent auditors in accordance with this pre-approval and the fees incurred to date. The Audit Committee may also pre-approve particular services on a case-by-case basis. 13
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ENEFTECH CORPORATION (A DEVELOPMENT STAGE COMPANY) -:- INDEPENDENT AUDITOR'S REPORT DECEMBER 31, 2004 AND 2003
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CONTENTS Page Independent Auditor's Report.............................................F - 1 Balance Sheets December 31, 2004 and 2003.............................................F - 2 Statements of Operations for the years ended December 31, 2004 and 2003 and the for the cumulative period From April 2, 2001 (Inception) to December 31, 2004....................F - 3 Statement of Stockholders' Equity Since April 1, 2001 (inception) to December 31, 2004...................F - 4 Statements of Cash Flows for the years ended December 31, 2004 and 2003 and the for the cumulative period From April 2, 2001 (Inception) to December 31, 2004....................F - 5 Notes to Financial Statements............................................F - 6
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INDEPENDENT AUDITOR'S REPORT Eneftech Corporation (A Development Stage Company) We have audited the accompanying balance sheets of Eneftech Corporation (a development stage company) as of December 31, 2004 and the related statements of operations, and cash flows for the year then ended and the cumulative since April 2, 2001 (inception) to December 31, 2004, and the statement of stockholders' equity from April 2, 2001 (inception) to December 31, 2004. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. The financial statements of Eneftech Corporation (a development stage company) as of December 31, 2003, were audited by other auditors whose report dated October 7, 2004, expressed an unqualified opinion on those statements. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Eneftech Corporation (a development stage company) as of December 31, 2004, and the results of its operations and its cash flows for the year ended December 31, 2004 in conformity with accounting principles generally accepted in the United States of America. F - 1
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The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Respectfully submitted, /s/ Robison, Hill & Co. Certified Public Accountants Salt Lake City, Utah March 31, 2005 F - 2
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ENEFTECH CORPORATION (A Development Stage Company) BALANCE SHEETS · Enlarge/Download Table December 31, 2004 2003 ------------------ ------------------ Assets: $ - $ - ================== ================== Liabilities - Accounts Payable $ - $ - ------------------ ------------------ Stockholders' Equity: Preferred Stock, par value $.0001, Authorized 20,000,0000 shares, Issued 0 shares at December 31, 2004 and 2003 - - Common Stock, par value $.0001, Authorized 100,000,000 shares, Issued 3,040,000 and 37,040,000 shares at December 31, 2004 and 2003 304 3,704 Paid-In Capital 25,769 7,369 Deficit Accumulated During the Development Stage (26,073) (11,073) ------------------ ------------------ Total Stockholders' Equity - - ------------------ ------------------ Total Liabilities and Stockholders' Equity $ - $ - ================== ================== The accompanying notes are an integral part of these financial statements. F - 3
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ENEFTECH CORPORATION (A Development Stage Company) STATEMENTS OF OPERATIONS · Enlarge/Download Table Cumulative since April 1, 2001 For the year ended inception of December 31, development -------------------------------------- 2004 2003 stage ------------------ ------------------ -------------------- Revenues: $ - $ - $ - Expenses: General & Administrative 15,000 - 26,073 ------------------ ------------------ -------------------- Net Loss $ (15,000) $ - $ (26,073) ================== ================== ==================== Basic & Diluted Loss per Share $ - $ - ================== ================== Weighted Average Shares Outstanding 15,335,890 37,040,000 ================== ================== The accompanying notes are an integral part of these financial statements. F - 4
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ENEFTECH CORPORATION (A Development Stage Company) STATEMENT OF STOCKHOLDERS' EQUITY SINCE APRIL 2, 2001 (INCEPTION) TO DECEMBER 31, 2004 · Enlarge/Download Table Deficit Accumulated Since April 2, 2001 Inception of Common Stock Paid-In Development Shares Par Value Capital Stage ----------------- --------------- -------------- ------------------ Balance at April 2, 2001 (Inception) - $ - $ - $ - October 25, 2001, Common stock issued for cash 5,000,000 500 500 - October 31, 2001, Contributed capital - - 2,790 - October 31, 2001, Common stock issued to acquire assets of Eneftech Group 30,000,000 3,000 - - December 15, 2001, Common stock issued pursuant to stock incentive plan 2,027,500 203 - - Net loss - - - (9,073) ----------------- --------------- -------------- ------------------ Balance at December 31, 2001 37,027,500 3,703 3,290 (9,073) February 15, 2002, Shares vested under - stock incentive plan 12,500 1 - Capital contributed by shareholder - - 4,079 - Net Loss - - - (2,000) ----------------- --------------- -------------- ------------------ Balance at December 31, 2002 37,040,000 3,704 7,369 (11,073) Net Loss - - - - ----------------- --------------- -------------- ------------------ Balance at December 31, 2003 37,040,000 3,704 7,369 (11,073) May 12, 2004, Cancellation of shares (34,000,000) (3,400) 3,400 - Capital contributed - - 15,000 - Net Loss - - - (15,000) ----------------- --------------- -------------- ------------------ Balance at December 31, 2004 3,040,000 $ 304 $ 25,769 $ (26,073) ================= =============== ============== ================== The accompanying notes are an integral part of these financial statements. F - 5
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ENEFTECH CORPORATION (A Development Stage Company) STATEMENTS OF CASH FLOWS · Enlarge/Download Table Cumulative since April 2, 2001 For the years ended Inception of December 31, Development ------------------------------------- 2004 2003 Stage ----------------- ------------------ ------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net Loss $ (15,000) $ - $ (26,073) Common Stock Issued for Services - - 4,204 Increase (Decrease) in Accounts Payable - - - ----------------- ------------------ ------------------ Net Cash Used in operating activities (15,000) - (21,869) ----------------- ------------------ ------------------ CASH FLOWS FROM INVESTING ACTIVITIES: Net cash provided by investing activities - - - ----------------- ------------------ ------------------ CASH FLOWS FROM FINANCING ACTIVITIES: Capital contributed by shareholder 15,000 - 21,869 ----------------- ------------------ ------------------ Net Cash Provided by Financing Activities 15,000 - 21,869 ----------------- ------------------ ------------------ Net (Decrease) Increase in Cash and Cash Equivalents - - - Cash and Cash Equivalents at Beginning of Period - - - ----------------- ------------------ ------------------ Cash and Cash Equivalents at End of Period $ - $ - $ - ================= ================== ================== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the year for: Interest $ - $ - $ - Franchise and income taxes $ - $ - $ - SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: None The accompanying notes are an integral part of these financial statements. F - 6
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ENEFTECH CORPORATION (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003 NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN The accompanying financial statements have been prepared on the basis of accounting principles applicable to a "going concern", which assume that the Company will continue in operation for at least one year and will be able to realize its assets and discharge its liabilities in the normal course of operations. Several conditions and events cast doubt about the Company's ability to continue as a "going concern." The Company has incurred net losses of approximately $26,000 for the period from April 2, 2001 (inception) to December 31, 2004, has a liquidity problem, and requires additional financing in order to finance its business activities on an ongoing basis. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained. The Company's future capital requirements will depend on numerous factors including, but not limited to, continued progress in finding a merger candidate and the pursuit of business opportunities. These financial statements do not reflect adjustments that would be necessary if the Company were unable to continue as a "going concern". While management believes that the actions already taken or planned, will mitigate the adverse conditions and events which raise doubt about the validity of the "going concern" assumption used in preparing these financial statements, there can be no assurance that these actions will be successful. If the Company were unable to continue as a "going concern," then substantial adjustments would be necessary to the carrying values of assets, the reported amounts of its liabilities, the reported revenues and expenses, and the balance sheet classifications used. Organization and Basis of Presentation The Company was incorporated under the laws of the State of Texas on April 2, 2001 under the name ILN Barrington Corporation. On October 25, 2001, the Company entered into a business combination and acquired all of the assets and liabilities of Eneftech Group, a California partnership, pursuant to an agreement and plan of reorganization. The agreement set forth that Barrington would issue 30,000,000 shares to the general partners of Eneftech Group. The Company's name was changed to Eneftech Corporation on October 21, 2001 to engage in the business of distributing power, heating and cooling generation for industrial, commercial and residential customers. During 2004, the plan was abandoned, the 30,000,000 shares issued under the plan were canceled and returned to the Company and an additional 4,000,000 shares issued to ILN Industries were also canceled. As of December 31, 2004, the Company is in the development stage, and has not commenced planned principal operations. F - 7
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ENEFTECH CORPORATION (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003 (Continued) NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN (Continued) Nature of Business The Company has no products or services as of December 31, 2004. The Company was organized as a vehicle to seek merger or acquisition candidates. The Company intends to acquire interests in various business opportunities, which in the opinion of management will provide a profit to the Company. NOTE 2 - SUMMARY OF ACCOUNTING POLICIES This summary of accounting policies for Eneftech Corporation (a development stage company) is presented to assist in understanding the Company's financial statements. The accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements. Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. Pervasiveness of Estimates The preparation of financial statements in conformity with generally accepted accounting principles required management 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. Loss per Share Basic loss per share has been computed by dividing the loss for the year applicable to the common stockholders by the weighted average number of common shares outstanding during the years. There were no common equivalent shares outstanding at December 31, 2004 and 2003. F - 8
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ENEFTECH CORPORATION (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003 (Continued) NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (Continued) Concentration of Credit Risk The Company has no significant off-balance-sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. NOTE 3 - INCOME TAXES As of December 31, 2004, the Company had a net operating loss carryforward for income tax reporting purposes of approximately $26,000 that may be offset against future taxable income through 2024. Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, the amount available to offset future taxable income may be limited. No tax benefit has been reported in the financial statements, because the Company believes there is a 50% or greater chance the carryforwards will expire unused. Accordingly, the potential tax benefits of the loss carryforwards are offset by a valuation allowance of the same amount. NOTE 4 - DEVELOPMENT STAGE COMPANY The Company has not begun principal operations and as is common with a development stage company, the Company has had recurring losses during its development stage. The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other material assets, nor does it have an established source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. In the interim, shareholders of the Company have committed to meeting its minimal operating expenses. NOTE 5 - COMMITMENTS As of December 31, 2004, all activities of the Company have been conducted by corporate officers from either their homes or business offices. Currently, there are no outstanding debts owed by the company for the use of these facilities and there are no commitments for future use of the facilities. F - 9
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SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Eneftech Corporation has duly caused this annual report on Form 10-KSB to be signed on its behalf by the undersigned, hereunto duly authorized. Dated: April 12, 2005 ENEFTECH CORPORATION By: /s/ Stephen Stotesbery ------------------------------------ Stephen Stotesbery CEO, President and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the issuer and in the capacities and on the dates indicated. NAME TITLE DATE /s/ Stephen Stotesbery ------------------------ Stephen Stotesbery CEO, President, Treasurer April 12, 2005 and Director /s/ Terence O'Keefe ------------------------ Terence O'Keefe Director April 12, 2005 /s/ Stanley Hirschman ------------------------ Stanley Hirschman Director April 12, 2005 /s/ Phil Pearce ------------------------ Director April 12, 2005 Phil Pearce 14

Dates Referenced Herein   and   Documents Incorporated By Reference

Referenced-On Page
This 10KSB Filing   Date First   Last      Other Filings
4/1/011519
4/2/01422
10/21/0122
10/25/01422
10/26/0111
10/29/014
10/31/0120
12/15/0120
2/15/0220
12/31/03102410KSB, 10KSB/A
5/10/044
5/12/0420
6/24/0448-K
8/5/044
8/20/044510KSB, 10QSB, 8-K
9/30/04910QSB
10/7/0416
10/15/0458-K
10/26/044
11/1/04510KSB/A
11/5/0448-K
For The Period Ended12/31/04124NT 10-K
3/17/059
3/18/0558-K
3/31/051710QSB, NT 10-K, NTN 10Q
4/12/0525
Filed On / Filed As Of4/15/05
 
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