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Autovative Technologies, Inc. – IPO: ‘S-1/A’ on 5/29/14

On:  Thursday, 5/29/14, at 1:47pm ET   ·   Accession #:  1271008-14-8   ·   File #:  333-193342

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 5/29/14  Autovative Technologies, Inc.     S-1/A                  5:1.2M                                   Stoecklein Ron/FA

Initial Public Offering (IPO):  Pre-Effective Amendment to Registration Statement (General Form)   —   Form S-1
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-1/A       Pre-Effective Amendment to Registration Statement   HTML    433K 
                          (General Form)                                         
 5: EX-5        Opinion of Counsel                                  HTML     12K 
 4: EX-10       Amended Contract-Otw                                HTML     29K 
 2: EX-23       Consent of Auditor                                  HTML      6K 
 3: EX-23       Consent of Experts or Counsel                       HTML      6K 


S-1/A   —   Pre-Effective Amendment to Registration Statement (General Form)


This is an HTML Document rendered as filed.  [ Alternative Formats ]



 

 

As filed with the Securities and Exchange Commission on May 29, 2014

                                                                                                                                             

Registration No. 333-193342

 



UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

  

FORM S-1/A

 

 

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

 

Autovative Technologies, Inc.

(Name of small business issuer in its charter)

 

 

Nevada 7812 46-1586920

State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer Identification

Code Number)

 

1010 Industrial Road #70

Boulder City, NV 89005

760-732-5868 

 

(Address and telephone number of registrant's principal executive offices and principal place of business.)

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

 

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. X_

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. __

 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. __

 

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. __

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.

 

                        Large accelerated filer __                         Accelerated filer __

 

                        Non accelerated filer __                         Smaller reporting company X

 

1


 

CALCULATION OF REGISTRATION FEE

 

Title of securities to be registered   Amount to be registered    

Proposed maximum offering price per

share

    Proposed maximum aggregate offering
price
  Amount of registration fee

 

  Common Stock $.001 par value       469,298     $ 1.00     $ 469,298     $ 60.45  

 

 

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED May 29, 2014

 

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the securities act of 1933 or until the registration statement shall become effective on such date as the commission, acting pursuant to said section 8(a), may determine.

 

The offering price has been estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457(a). The selling shareholders may sell shares of our common stock at a fixed price of $1.00 per share until our common stock is quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices. The fixed price of $1.00 has been determined as the selling price until the shares are quoted on the OTC Bulletin Board and thereafter will be quoted at prevailing market prices or privately negotiated prices based upon the original purchase price paid by the selling shareholders of $0.10 plus an increase based on the fact the share will be liquid and registered.    There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved.

 

 

 

2


 

 

PRELIMINARY PROSPECTUS

AUTOVATIVE TECHNOLOGIES, INC

1010 Industrial Road #70

Boulder City, NV 89005

760-732-5868

469,298 Shares of Common Stock

Price per share: $1.00

Total cash proceeds to the Company $0.

 

Through this prospectus, we are registering for resale 469,298 shares of common stock. The Company is authorized to issue 75,000,000 shares of common stock, par value $0.001 per share. As of September 30, 2013 there were 6,789,298 shares of common stock issued and outstanding. 

 

The selling shareholders named in this prospectus are offering all of the shares of common stock offered through this prospectus. The selling stockholders are selling shares of common stock covered by this prospectus for their own account.  There is no present public trading market for the Company's Common Stock and the price at which the Shares are being offered bears no relationship to conventional criteria such as book value or earnings per share.  The Company has determined the offering price based, primarily, on its projected operating results. There can be no assurance that the offering price bears any relation to the current fair market value of the Common Stock.

 

There is no trading market for our common stock.

 

The sales price to the public is fixed at $1.00 per share until such time as the shares of common stock become traded on the Over the Counter Bulletin Board or another exchange and thereafter will be quoted at prevailing market prices or privately negotiated prices. We intend to contact an authorized OTCBB market maker for sponsorship of our securities on the OTCBB, upon effectiveness of this registration statement; however, there is no guarantee our common stock will be accepted for quotation on the OTC Bulletin Board. If our common stock becomes quoted on the Over the Counter Bulletin Board or another exchange, then the sales price to the public will vary according to the selling decisions of each selling shareholder and the market for our stock at the time of resale.

 

We are an "emerging growth company" under applicable federal securities laws and will be subject to reduced company reporting requirements.  

 

The purchase of our shares involves substantial risk. See "risk factors" beginning on page 9 for a discussion of risks to consider before purchasing our common stock.

 

You should rely only on the information contained in this prospectus. We have not, and the Selling Stockholders have not, authorized anyone to provide you with different information. If anyone provides you with different information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information contained in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense.

 

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL OUR SHARES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL OUR SHARES, AND IT IS NOT SOLICITING AN OFFER TO BUY OUR SHARES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

 

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED May 29, 2014

 

3


 

TABLE OF CONTENTS

 

    PAGE
Prospectus Summary     5  
Summary Financial Data     7  
Risk Factors     8  
Use of Proceeds     12  
Determination of Offering Price     12  
Dilution     12  
Selling Security Holders     12  
Plan of Distribution     14  
Description of Securities to be Registered     15  
Interests of Named Experts and Counsel     16  
Description of Business     17  
Special Note Regarding Forwarding Looking Statements     20  
Directors, Executive Officers, Promoters And Control Persons     20  
Legal Proceedings     22  
Security Ownership of Certain Beneficial Owners and Management     22  
Related Party Transactions     23  
Disclosure Of Payment Of Services With Shares Of Common Stock     24  
Disclosure Of Commission Position On Indemnification For Securities Act Liabilities     24  
Report to Security Holders     24  
Financial Statements     F1-F28  
Management's Discussion And Analysis Of Financial Condition And Results Of Operations     26  
Part II Information Not Required In Prospectus     27  
Signatures     30  

 

 

 

4


 

PROSPECTUS SUMMARY

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense.

 

You should read the following summary together with the more detailed information about our company and the common stock being registered in this offering and our financial statements and the notes to those statements included elsewhere in this prospectus. The selling stockholders are selling shares of common stock covered by this prospectus for their own account References in this prospectus to "we," "our," "us", "Autovative" and the "Company" refer to AUTOVATIVE TECHNOLOGIES, INC.

 

Organizational History

 

Autovative Technologies, Inc. ("ATI") was incorporated under the laws of the State of Nevada on December 10, 2012. Autovative Technologies was a wholly owned subsidiary of Autovative Products, Inc. ("API"), a publicly traded Nevada corporation. On December 31, 2012, the Company created a wholly owned subsidiary, Autovative Products, Inc., in the State of Montana.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk constituted all of the issued and outstanding shares of Autovative Products, Inc's subsidiary, Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of its Predecessor, Autovative Products, Inc. on a pro rata basis, based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

ATI was formed to develop businesses, assets and opportunities, some acquired and contributed from third parties and our founding shareholders, in the trucking/automobile special parts production and distribution industry and some related fields. ATI is a specialty distribution company of fleet truck products. Currently the Company has exclusive distribution rights with both FedEx (Federal Express) and UPS (United Postal Service) for its Portable Tow Truck Units.

 

The audited financial statements of Autovative Products, Inc., (our former parent "Predecessor") as of December 31, 2012 are included to present the operations for the Predecessor periods.

Introduction

 

Autovative Technologies, Inc. is a distributor of automotive specialty parts. We have developed and produced two products for both automobile and fleet uses. We are resellers of OTW Enterprises LLC's Portable Tow Truck pursuant to a marketing/sales agreement, a traction aid which has been successful in helping drivers get their vehicles unstuck from snow, ice, mud and sand; and the Overhead Door Saver, a heavy-duty spring device for use in fleets of trucks with overhead doors. It cushions the shock of constant door openings which we believe will reduce overhead door repairs. Currently the majority of our products sold are to FedEx (Federal Express) and UPS (United Postal Service) for use with their trucking fleets. Our products do not have patent protection nor do we have any trademarks or copyrights on our products.

 

Company Assets

 

The Company's principal assets ("Assets") consist of cash. All of the Company's income to date has been generated from sales of its Portable Tow Truck product to FedEx and UPS for use with their trucking fleets. It is management's opinion that based on the assets it has, including cash, contracts, future revenue streams, rights and certain business concepts it may not be able to adequately capitalize the Company for the next twelve (12) months. Based on current cash, without additional cash the Company would run out of funds in 10 months. (See "Company Cash Flow" Page 5). There is no guarantee that we will be able to increase our revenue streams. Currently only commissions have been paid and are currently being paid for sales made. However it is also of the opinion of management that without additional funding to the Company we may not be able to pay the additional expenses necessary to continue as a going concern or to pay the expenses of being a public Company which by themselves are and could be substantial. There are no plans in place for additional funding. Our President, David Funderburk, has indicated that although he has no obligation to pay any expenses of the Company, he would pay for any and all expenses incurred by the Company until such time that the Company is able to generate sufficient revenues to repay any loans he might make to the Company and to pay ongoing expenses. However there is no guarantee that David Funderburk would continue to pay for expenses for the company in the future. At this time no loans have been made by David Funderburk and there is no loan agreement in place between the Company and its President, David Funderburk. In addition our auditor has stated in his audit of the Company's financial statements that we have not generated significant revenues or profits to date which raises substantial doubt as to our ability to continue as a going concern.

 

Company Cash Flow

 

The Company has cash assets derived from its distribution of its products and a private placement of its stock.  Assuming the Company does not generate any income from its products it believes it may have sufficient cash to operate for the next 10 months based on current cash; however with the added expense of being a public company it is likely that we will not be able to pay additional expenses without additional funding. Currently there are no plans in place for additional funding. The Company's overhead is currently paid for by its President, David Funderburk. In the future without his capital infusion it is possible that the Company would have no money with which to operate and there is no guarantee that David Funderburk would continue to pay for expenses for the company in the future. As of September 30, 2013 the Company had cash of $81,362. As of December 31, 2013 the Company had cash of $40,080. The Company has elected to pay its President $2,500 per month in salary beginning in September 2013. Based on $8,000 in advertising expenses for the year end and the $2,689 in office expenses and projected salary of $2,500 and projected professional expenses of $6,000 within the next 5 months the Company's average burn rate equates to $3,991 per month (annualized) (excludes commissions which are only paid after revenue is received from sales; and, depreciation and professional fees which to date have been associated with the preparation of the S-1 filing). Without additional cash the Company would run out of funds in approximately 10 months. From its inception the Company's primary business activity was to aid in the manufacturing process of its products and to create sales in the larger trucking fleets, complete a private placement of some of its common shares, establish its web site, progress sales of its products and conduct an audit and assist legal counsel and others in the preparation and drafting of this Registration Statement.  

 

Losses

 

The Company had a net loss of $6,328 from inception (December 10, 2012) through year end September 30, 2013 and net income of $7,669 for the period ended December 31, 2013.

 

Aggregate Market Price of Common Stock

 

The balance of total stockholders' equity at the most recent balance sheet date was $50,440. The aggregate market price of our common stock based on the proposed offering price of $1.00 using the most recent balance sheet date is $6,789,298

 

5


 

Future Assets and Growth

 

We will continue to generate limited future income from our assets; however, we cannot provide absolute assurances or estimates of these revenues. The Company had net losses in its initial nine months, and the Company anticipates it may operate at a deficit for its next fiscal year and may expend most of its available capital. The Company's current cash on hand is, primarily, budgeted to cover the anticipated costs of its administrative overhead and costs associated with developing and operating the businesses going forward including costs for legal, accounting and transfer agent services. We believe that the Company will have sufficient capital to operate its business over the next ten months based on its current cash. There can be no assurances, however, that actual expenses incurred will not materially exceed our estimates or that cash flows from our existing assets will be adequate to maintain our businesses.

 

The automotive industry as a whole is an extremely competitive industry dominated by many very large, fully integrated conglomerates. The Company is building its business model cognizant of these market realities and management will be attempting to use and capitalize upon the internet and website development to deliver and market its products.

 

Our business model is predicated on the assumption that we can continue to generate revenue from the Portable Tow Truck and that we will generate revenue from Overhead Door Saver and from additional products we hope to distribute in the future. There are no additional products currently that we anticipate adding to our product lines and currently there is no specific timeline to add such products. There is no guarantee that we will continue to generate revenue from the Portable Tow Truck and that we will generate revenue from Overhead Door Saver and from products we might distribute over the next fiscal year; or, that we can successfully manage our costs by capitalizing on business developments and our management. There is no guarantee that we will be able to increase our revenue streams. Although we generated losses for the last year of operation and anticipate we may lose money in the current fiscal year we believe that our Business Strategy combined with raising additional capital will place us in a position to increase our revenue streams.

 

Based on the assumption that we will be able to raise additional capital we have projected that we would need a minimum of $41,000 to reach the goals of our Business Strategy and an optimum of $166,000. (See "Business Strategy" page 17). At this time there is no plan in place to raise additional capital nor is their any assurance that we will be able to raise additional capital.

 

The Company's primary manager, its President, Mr. Funderburk, has operated the Company for the last year. Mr. Funderburk operated its previous parent Company, Autovative Products, Inc. (a Nevada corporation) since its inception in 2005; and operated its previous parent Company, Autovative Products, Inc. (a Nevada Corporation) as a public entity since January 12, 2012 when its S-1 Registration statement became effective. Outside of the operations of the previous parent Company, Mr. Funderburk has no experience or expertise in operating a public company. Until such time as the Company is more established and capitalized, we will not be able to employ any personnel on a full time basis.

 

FOUNDING SHAREHOLDERS

 

The following individuals and entities are considered founding shareholders of our Company.

 

Class Name Shares Percentage
Common David Funderburk  (1) 6,320,000 93%
       
 (1)   Mr. David Funderburk, our sole officer and a director and hereafter referred to as "President" where applicable, is the operating manager of Autovative Technologies, Inc.
         

 

6


 

 

Terms of the Offering

 

The selling shareholders named in this prospectus are offering all of the shares of common stock offered through this prospectus. The selling stockholders are selling shares of common stock covered by this prospectus for their own account.

 

We will not receive any of the proceeds from the resale of these shares. The offering price of $1.00 was determined by the price shares were sold to our shareholders in a private placement memorandum plus an increase based on the fact the shares will be liquid and registered. $1.00 is a fixed price at which the selling security holders may sell their shares until our common stock is quoted on the OTC Bulletin Board or another Exchange, at which time the shares may be sold at prevailing market prices or privately negotiated prices. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved. We have agreed to bear the expenses relating to the registration of the shares for the selling security holders.


SUMMARY FINANCIAL DATA

 

The following summary financial data should be read in conjunction with "Management's Discussion and Analysis and Results of Operations" and the Financial Statements and Notes thereto, included elsewhere in this prospectus. The statement of operations and balance sheet data for the three months ended December 31, 2013 is derived from our audited financial statements.

 
 

 

 

 

December 31, 2011

Predeccesor

Autovative Products, Inc.
(Audited)

December 31, 2012

Predeccesor

Autovative Products, Inc.
(Audited)

September 30, 2013

(Audited)

 

December 31, 2013

(Unaudited)

 

STATEMENT OF OPERATIONS        
Total Revenues $                       120,690 $                            74,300  $                62,673 $                    28,556
Cost of Revenues  46,544 40,368 47,696  21,248
Gross Margin  74,146 33,932 14,977  7,308
Operating Expenses  59,921 67,907 36,305  14,639
Net operation loss   14,225 (33,975) (21,328)  (7,331)
Other income(Expenses)  (49,100) (925) 15,000  15,000
Net Loss  (34,874) (34,900) (6,328)  7,669
         
Weighted average number of
common shares outstanding for
the period
 8,585,977 8,584,523 2,195,166 6,789,298
Net Income Per Share (0.00) (0.00) (0.00) 0.00

 

 

 

December 31, 2011

Predeccesor

Autovative Products, Inc.
(Audited)

December 31, 2012

Predeccesor

Autovative Products, Inc.
(Audited)

September 30,2013

(Audited)

December 31, 2013
(Unaudited
BALANCE SHEET DATA        
Cash $               28,343 $                 1,774 $             81,362 $             40,080
Total Assets  46,218 15,657 89,677 74,861
Total Liabilities  45,225 49,565 46,906 24,420
Stockholder's Equity  993 (33,907) 42,771 50,440
         
         

 

 

7


 

ABOUT THIS OFFERING

 

 Securities Being Offered Up to 469,298 shares of common stock in Autovative Technologies, Inc.
   
Initial Offering Price The selling shareholders may sell shares of our common stock at a fixed price of $ 1.00 per share until our common stock is quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices.  
   
Terms of the Offering The selling shareholders will determine the terms relative to the sale of the common stock offered in this Prospectus.
   
Termination of the Offering

The offering will conclude when all of the 469,298 shares of common stock have been sold or at a time when the Company, in its sole discretion, decides to terminate the registration of the shares. The Company may decide to terminate the registration if it is no longer necessary due to the operation of the resale provisions of Rule 144 promulgated under the Securities Act of 1933. We may also terminate the offering for no given reason whatsoever.

 

 

   
Risk Factors The securities offered hereby involve a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "Risk Factors."
   
Common Stock Issued Before Offering 6,789,298 shares of our common stock are issued and outstanding as of the date of this prospectus.
   

Common Stock Issued After Offering

 

6,789,298 shares of common stock.

 

Use of Proceeds We will not receive any proceeds from the sale of the common stock by the selling shareholders.
   
     

 

Description of Selling Stockholders

 

Through this prospectus, we are registering for resale 469,298 shares of common stock. The Company is authorized to issue 75,000,000 shares of common stock, par value $0.001 per share. As of December 31, 2013 and September 30, 2013 there were 6,789,298 shares of common stock issued and outstanding. 

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk constituted all of the issued and outstanding shares of Autovative Products, Inc's subsidiary, Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of its Predecessor, Autovative Products, Inc. on a pro rata basis, based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

On August 15, 2013, the Company issued 80,000 shares of restricted 144 common stock per a contract with Blue Sky Media Corporation (for advertising services valued at $8,000 or $0.10 per share).

 

On September 23, 2013, the Company issued 250,000 shares of restricted 144 common stock to Janice Douglas for $0.10 per share for a total of $25,000. On September 25, 2013 the Company issued 3,500 shares to Steve Lynch for consulting\marketing services valued at $0.10 per share.

 

The names and share amounts of the selling stockholders are set forth under "Selling Stockholders and Plan of Distribution" in this prospectus.  None of the selling stockholders are officers, directors or 10% or greater stockholders of our company nor are any affiliated or associated with any broker-dealers.

 

 

RISK FACTORS

 

YOU SHOULD CAREFULLY CONSIDER THE POSSIBILITY THAT YOUR ENTIRE INVESTMENT MAY BE LOST. AS SUCH, YOU ARE ENCOURAGED TO EVALUATE THE FOLLOWING RISK FACTORS AND ALL OTHER INFORMATION CONTAINED IN THIS PROSPECTUS BEFORE PURCHASING OUR COMMON STOCK. OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. ANY OF THE FOLLOWING RISKS COULD ADVERSELY AFFECT OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS, AND COULD RESULT IN COMPLETE LOSS OF YOUR INVESTMENT.

 

WE HAVE A LIMITED OPERATING HISTORY THAT YOU CAN USE TO EVALUATE US, AND THE LIKELIHOOD OF OUR SUCCESS MUST BE CONSIDERED IN LIGHT OF THE PROBLEMS, EXPENSES, DIFFICULTIES, COMPLICATIONS AND DELAYS FREQUENTLY ENCOUNTERED BY A SMALL DEVELOPING COMPANY.

 

We were incorporated in Nevada on December 10, 2012. We have limited financial resources and only limited revenues to date. The likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered by a small developing company starting a new business enterprise and the highly competitive environment in which we will operate. Since we have a limited operating history, we cannot assure you that our business will be profitable or that we will ever generate sufficient revenues to fully meet our expenses and totally support our anticipated activities.

 

 All of our capital and assets have been provided by or acquired from our principal shareholders and third parties and through a Private Placement of the shares being registered as well as from sales of our Portable Tow Truck Product. We cannot assure you, however, that we will be able to sustain the business for the long term nor that we may not need to obtain additional capital in the future. We can also not assure you that we will be able to obtain any required financing on a timely basis, or if obtainable, that the terms will not materially dilute the equity of our current stockholders. If we are unable to obtain financing on a timely basis, we may have to significantly or entirely curtail our business objectives, which could result in our having to discontinue some of our operations and plans.

 

OUR AUDTIOR'S REPORT CONTAINS AN EXPLANATORY STATEMENT AS TO OUR ABILITY TO CONTINUE AS A GOING CONCERN.

 

The Company has had losses since its inception. There is no assurance that we will become profitable in the future.

 

Our auditor has included the following paragraph in his Auditor's report (page F1-2)

 

"The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has limited operations and has limited established sources of revenue. This raises substantial doubt about its ability to continue as a going concern. Management's plan in regard to these matters is also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty."

 

WE HAVE LIMITED OPERATING CAPITAL

 

The Company has cash assets derived from its distribution of its products and a private placement of its stock. Assuming the Company does not generate any income from its products it believes it may have sufficient cash to operate for the next 10 months based on current cash; however with the added expense of being a public company it is likely that we will not be able to pay additional expenses without additional funding. Currently there are no plans in place for additional funding. The Company's overhead is currently paid for by its President, David Funderburk. In the future without his capital infusion it is possible that the Company would have no money with which to operate. As of September 30, 2013 the Company had cash of $81,362. As of December 31, 2013 the Company had cash of $40,080. The Company has elected to pay its President $2,500 per month in salary beginning in September 2013. Based on $8,000 in advertising expenses for the year end and the $2,689 in office expenses and projected salary of $2,500 and projected professional expenses of $6,000 within the next 5 months the Company's average burn rate equates to $3,991 per month (annualized) (excludes commissions which are only paid after revenue is received from sales; and, depreciation and professional fees which to date have been associated with the preparation of the S-1 filing). Without additional cash the Company would run out of funds in approximately 10 months.

 

WE MAY NOT BE ABLE TO REACH OUR BUSINESS GOALS

 

Based on the assumption that we will be able to raise additional capital we have projected that we would need a minimum of $41,000 to reach the goals of our Business Strategy and an optimum of $166,000. (See "Business Strategy" page 17). At this time there is no plan in place to raise additional capital nor is their any assurance that we will be able to raise additional capital.

 

 

WE DEPEND HIGHLY ON OUR CURRENT PRESIDENT WHO HAS LIMITED EXPERIENCE IN RUNNING A PUBLIC COMPANY AND NO FORMAL EMPLOYMENT AGREEMENT.

 

We depend highly on David Funderburk, our President, who may be difficult to replace. David Funderburk, our President, only devotes approximately 40% of his time per week to our business, has eight years of industry experience and two years experience heading a public Company. Our plan of operations is dependent upon the continuing support and business expertise of Mr. Funderburk.

 

OUR SOLE EMPLOYEE IS OUR SOLE DIRECTOR; AS SUCH HE WILL DETERMINE HIS COMMISSION, SALARY AND PERQUISITES.

 

Mr. Funderburk is the Company's sole officer and sole director and sole employee. He has in the past and will continue to determine his commission, salary and perquisites. Mr. Funderburk is on a monthly salary of $2,500, which was initiated in September 2013. There is no assurance there will be sufficient capital in the future to pay the monthly salary in which case the amount would accrue as a liability.

 

A LARGE PORTION OF OUR SALES ARE MADE BY INDIVIDUALS WHO ARE NOT EMPLOYEES AND ARE NOT CONTRACTED BY THE COMPANY.

 

We have engaged the services of two (2) additional sale persons who are paid commissions on sales they make. Neither individual is contracted by the Company nor are they employed by the Company. These sales people are paid a set commission depending on the entity sales are made to. Should the Company lose either of these sales people it would impact the sales revenues generated by the Company.

 

LOSS OF OUR CEO COULD ADVERSELY AFFECT OUR BUSINESS

 

Loss of Mr. Funderburk could slow the growth of our business, or it may cease to operate at all, which may result in the total loss of investor's investments. The company currently pays a monthly salary of $2,500 to Mr. Funderburk which was initiated in September 2013. There is no assurance there will be sufficient capital in the future to pay the monthly salary in which case the amount would accrue as a liability.

 

 

OUR MANAGEMENT HAS LIMITED EXPERIENCE IN RUNNING A PUBLIC COMPANY

 

Mr. Funderburk has limited experience in running a public company. He is vaguely familiar with the reporting requirements of the Securities and Exchange Commission. Mr. Funderburk will rely on the expertise of outside counsel and consultants to insure proper filing and the meeting of deadlines.

 

THERE ARE INCREASED COSTS AND REGULATIONS ASSOCIATED WITH OPERATING A PUBLIC COMPANY AND WITH ONLY ONE OFFICER AND DIRECTOR WE WILL HAVE LIMITED INTERNAL ACCOUNTING CONTROLS.

 

There are a number of expenses and costs associated with operating a public Company including filing expenses, transfer agent, stock issuance and maintenance costs, accounting, legal and auditing expenses, estimated to be approximately $15,000 annually that will materially increase the Company's operating expenses and make it more difficult for the Company's businesses to produce operating profits. There is no assurance that we can absorb the costs of being a public company. Our CEO has limited prior experience managing a public company. With only one officer and director there will be no internal oversight to the Company's financial reporting, initially, except from the Company's outside auditors.

 

8


 

THERE IS NO ASSURANCE OF A PUBLIC MARKET OR THAT THE COMMON STOCK WILL EVER TRADE ON A RECOGNIZED EXCHANGE. THEREFORE, YOU MAY BE UNABLE TO LIQUIDATE YOUR INVESTMENT IN OUR STOCK.

 

There is no established public trading market for our common stock. Our shares are not and have not been listed or quoted on any exchange or quotation system. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved or that a regular trading market will develop or that if developed, will be sustained. In the absence of a trading market, an investor may be unable to liquidate their investment.

 

SINCE A SINGLE STOCKHOLDER, UPON COMPLETION OF THE OFFERING, WILL BENEFICIALLY OWN THE SIGNIFICANT MAJORITY OF OUR OUTSTANDING COMMON SHARES, THAT SINGLE STOCKHOLDER WILL RETAIN THE ABILITY TO POTENTIALLY CONTROL OUR MANAGEMENT AND THE OUTCOME OF CORPORATE ACTIONS REQUIRING STOCKHOLDER APPROVAL NOTWITHSTANDING THE OVERALL OPPOSITION OF OUR OTHER STOCKHOLDERS. THIS CONCENTRATION OF OWNERSHIP COULD DISCOURAGE OR PREVENT A POTENTIAL TAKEOVER OF OUR COMPANY THAT MIGHT NEGATIVELY IMPACT THE VALUE OF YOUR COMMON SHARES.

 

David Funderburk owns approximately 93% of our outstanding common shares and will continue to do so after the filing of this Registration Statement. As a consequence of his stock ownership position, Mr. Funderburk will retain the ability to elect a majority of our board of directors, and thereby control our management. David Funderburk also has the ability to control the outcome of corporate actions requiring stockholder approval, including mergers and other changes of corporate control, any private transactions, and other extraordinary transactions. The concentration of ownership by David Funderburk could discourage investments in our company, or prevent a potential takeover of our company which will have a negative impact on the value of our securities.

 

BECAUSE OF COMPETITIVE PRESSURES FROM COMPETITORS WITH MORE RESOURCES, AUTOVATIVE TECHNOLOGIES MAY FAIL TO IMPLEMENT ITS BUSINESS MODEL PROFITABLY.

 

The automotive specialty product business is highly fragmented and extremely competitive. The market for customers is intensely competitive and such competition is expected to continue to increase (see "Competition"). We believe that our ability to compete depends upon many factors within and beyond our control, including the timing and market acceptance of new solutions and enhancements to existing businesses developed by us, our competitors, and their advisors.

 

WE ARE DEPENDENT ON THE POPULARITY OF PRODUCTS.

 

Our ability to generate revenue and be successful in implementing our business plan is dependent on our ability to develop, produce, acquire and distribute products that are popular with audiences and sold via distribution channels that are efficient and cost effective. There is no assurance that we can accomplish that goal. Further our major customers are FedEx (Federal Express) and UPS (United Parcel Service), should we lose that customer base we would have lost our major revenue source.

 

OUR CURRENT REVENUE DEPENDS SOLELY ON TWO MAJOR CUSTOMERS.

 

We currently sell the Portable Tow Truck units to FedEx and to UPS. We have no ongoing contract with either entity. We have also sold territories for the retail sale of the Portable Tow Truck but there is no assurance that we will be able to continue to make sales of additional territories. Currently, should we lose these customers we would have no revenue and we would have no ability to continue as a going concern.

 

 

WE MAY BE UNABLE TO COMPETE WITH LARGER OR MORE ESTABLISHED COMPANIES.

 

We face a large and growing number of competitors in the automotive specialty product industry. Many of these competitors have substantially greater financial, technical and marketing resources, larger customer bases, longer operating histories, greater name recognition, and more established relationships in the industry than does the Company. As a result, certain of these competitors may be in better positions to compete with us for product and audiences. We cannot be sure that we will be able to compete successfully with existing or new competitors.

 

WE COULD HAVE DIFFICULTY PENETRATING RETAIL MARKETS WHICH COULD AFFECT OUR ABILITY TO GENERATE REVENUES THROUGH THE RETAIL MARKETPLACE DUE TO AN AGREEMENT WITH OUR MANUFACTURER.

 

Although we have a contract for the exclusive rights for sales of the Portable Tow Truck and the Overhead Door Saver, there currently is another Company with the website name www.theportabletowtruck.com that sells the Portable Tow Truck on a retail only basis. The Company is owned by the manufacturer of the Portable Tow Truck units that we currently sell for commercial use. They are not affiliated with our company and sell the Portable Tow Truck strictly on a retail basis though their Company website. A verbal agreement was reached between us and the Manufacturer of the products whereby the Manufacturer could make retail sales but only through their web site www.theportabletowtruck.com. This agreement could affect our ability to penetrate the retail markets and it could confuse retail buyers that we may generate through our web site or any other means. This could affect our ability to generate revenues through the retail marketplace.

 

WE MAY REQUIRE ADDITIONAL FINANCING IN ORDER TO IMPLEMENT OUR BUSINESS PLAN. IN THE EVENT WE ARE UNABLE TO ACQUIRE ADDITIONAL FINANCING, WE MAY NOT BE ABLE TO IMPLEMENT OUR BUSINESS PLAN RESULTING IN A LOSS OF REVENUES AND ULTIMATELY THE LOSS OF ANY SHAREHOLDER'S INVESTMENT.

 

Due to our limited operating history outside of two customers, FedEx and UPS, we will have to use all our existing resources to expand our business and develop our distribution channels.

 

Following this offering we may need to raise additional funds to expand our operations. We may raise additional funds through private placements, registered offerings, debt financing or other sources to maintain and expand our operations, although at this time there is no plan in effect to do so. Adequate funds for this purpose on terms favorable to us may not be available, and if available, on terms significantly more adverse to us than are manageable. Without new funding, we may be only partially successful or completely unsuccessful in implementing our business plan, and our stockholders will lose part or all of their investment.

 

9


 

OUR PRODUCTS OR PROCESSES COULD GIVE RISE TO CLAIMS THAT OUR PRODUCTS INFRINGE ON THE RIGHTS OF OTHERS.

 

We are potentially subject to claims and litigation from third parties claiming that our products or processes infringe their patent or other proprietary rights. If any such actions are successful, in addition to any potential liability for damages, we could be required to obtain a license in order to continue to manufacture, use or sell the affected product or process. Litigation, which could result in substantial costs to us, may also be necessary to enforce our proprietary rights and/or to determine the scope and validity of the proprietary rights of others. Any intellectual property litigation would be costly and could divert the efforts and attention of our management and technical personnel, which could have a material adverse effect on our business, financial condition and results of operations. We cannot assure you that infringement claims will not be asserted in the future or that such assertions, if proven to be true, will not prevent us from selling our products or materially and adversely affect our business, financial condition and results of operations. If any such claims are asserted against us, we may seek to enter into a royalty or licensing arrangement. We cannot assure you that a license will be available on commercially reasonable terms, or at all. Regarding our Overhead Door Saver; there is an existing patent for the basic technology used in the Overhead Door Saver which precludes us from obtaining a patent for the Overhead Door Saver. It is possible that a Company with greater resources could copy our design for the Overhead Door Saver which could potentially affect any future revenues that might be generated from the Overhead Door Saver. It is also possible that we could infringe on an existing patent for the basic technology which was used in the production of the Overhead Door Saver.

 

WE MAY BE SUBJECT TO CLAIMS OF TRADEMARK INFRINGEMENT, WHICH MAY HARM OUR BUSINESS.

 

The Company currently has not filed any trademarks or copyrights for its products. However we intend to file in the near future. We may be subject to legal proceedings alleging claims of trademark infringement in the future. If we must re-brand, it may result in significant marketing expenses and additional management time and resources, which may adversely affect our business.

 

Additionally, we cannot guarantee that our trademarks will be completely protected. This could cause harm to our brand and ultimately, to us. We could also spend additional time and resources fighting other entities that might infringe upon our trademarks.

 

We applied for a patent for the Overhead Door Saver and our patent application was declined, which may allow competitors to copy our designs for both the Portable Tow Truck and the Overhead Door Saver. Should a larger Company copy our designs, it is possible that they may be able to manufacture and sell the like kind products at a substantially lower cost than us.

 

Although we have a contract for the exclusive rights for sales of the Portable Tow Truck and the Overhead Door Saver, there currently is another Company with the website name www.theportabletowtruck.com that sells the Portable Tow Truck on a retail only basis. The Company is owned by the manufacturer of the Portable Tow Truck units that we currently sell for commercial use. They are not affiliated with our company and sell the Portable Tow Truck strictly on a retail basis though their Company website. A verbal agreement was reached between us and the Manufacturer of the products in 2007 whereby the Manufacturer could make retail sales but only through their web site. This agreement could affect our ability to penetrate the retail markets and it could confuse retail buyers that we may generate through our web site. This could affect our ability to generate revenues through the retail marketplace.

 

OUR PATENT APPLICATION WAS DENIED.

 

A patent was applied for regarding the Overhead Door Saver which was denied due to the fact that there was an existing patent for the basic technology which we applied for, although for a different use.

                     

We explored filing a patent for the Portable Tow Truck but did not file a patent for the Portable Tow Truck.

 

As such it is entirely possible that a company with greater resources could copy our designs of both the Overhead Door saver and the Portable Tow Truck and manufacture and sell a similar product.

 

WE MAY BE SUBJECT TO LAWSUITS FROM CUSTOMERS WHO ARE INJURED USING OUR PRODUCTS.

 

Although we have what we believe to be clear instructions on how to use our products, it is possible that a customer may get injured form using one of our products and subsequently file a lawsuit against the Company. If we are unable to settle such a lawsuit it could adversely affect our business and shareholders investment in the Company. We have no liability insurance in place at this time.

 

WE MAY BE UNABLE TO SCALE OUR OPERATIONS SUCCESSFULLY.

 

Our plan is to grow rapidly. Our growth will place significant demands on our management and technology development, as well as our financial, administrative and other resources. We cannot guarantee that any of the systems, procedures and controls we put in place will be adequate to support the commercialization of our operations. Our operating results will depend substantially on the ability of our officers and key employees to manage changing business conditions and to implement and improve our financial, administrative and other resources. If we are unable to respond to and manage changing business conditions, or the scale of our products, services and operations, then the quality of our services, our ability to retain key personnel and our business could be harmed.

 

MR. FUNDERBURK HAS NO EXPERIENCE IN THE GROWTH AND EXPANSION OF A BUSINESS AND HE WILL BE RELIANT ON CONSULTANTS AND OTHERS WHO HAVE GREATER MANAGEMENT EXPERIENCE. THE LACK OF EXPERIENCE IN ALL OF THE BUSINESSES WE ARE ENTERING COULD IMPACT OUR RETURN ON INVESTMENT, IF ANY.

 

As a result of our reliance on Mr. Funderburk and his lack of experience in Company expansion\growth, our investors are at risk in losing their entire investment. Mr. Funderburk intends to hire personnel in the future who will have the experience required to manage our company, when the Company is sufficiently capitalized. Until such management is in place, we are reliant upon Mr. Funderburk to make the appropriate management decisions.

 

AS THERE IS NO PUBLIC MARKET FOR OUR COMMON SHARES, THEY ARE AN ILLIQUID INVESTMENT AND INVESTORS MAY NOT BE ABLE TO SELL THEIR SHARES.

 

No market currently exists for our securities and we cannot assure you that such a market will ever develop, or if developed, will be sustained.

 

Our common stock is not currently eligible for trading on any stock exchange and there can be no assurance that our common stock will be listed on any stock exchange in the future. We intend to apply for listing on the OTC Bulletin Board trading system pursuant to Rule 15c2-11 of the Securities Exchange Act of 1934, but there can be no assurance we will obtain such a listing. The bulletin board tends to be highly illiquid, in part because there is no national quotation system by which potential investors can track the market price of shares except through information received or generated by a limited number of broker-dealers that make a market in particular stocks. There is a greater chance of market volatility for securities that trade on the bulletin board as opposed to a national exchange or quotation system. This volatility may be caused by a variety of factors, including: the lack of readily available price quotations; the absence of consistent administrative supervision of "bid" and "ask" quotations; lower trading volume; and general market conditions. If no market for our shares materializes, you may not be able to sell your shares or may have to sell your shares at a significantly lower price.

 

10


IF OUR SHARES OF COMMON STOCK ARE ACTIVELY TRADED ON A PUBLIC MARKET, THEY WILL IN ALL LIKELIHOOD BE PENNY STOCKS.

 

The Securities Enforcement and Penny Stock Reform Act of 1990 requires additional disclosure relating to the market for penny stocks in connection with trades in any stock defined as a penny stock. SEC regulations generally define a penny stock to be an equity security that has a market or exercise price of less than $5.00 per share, subject to certain exceptions. Such exceptions include any equity security listed on NASDAQ and any equity security issued by an issuer that has net tangible assets of at least $100,000, if that issuer has been in continuous operation for three years. Unless an exception is available, the regulations require delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the associated risks. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, details of the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations and broker-dealer and salesperson compensation information must be given to the customer orally or in writing prior to effecting the transaction and must be given in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from such rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for securities that become subject to the penny stock rules. Since our securities are highly likely to be subject to the penny stock rules, should a public market ever develop, any market for our shares of common stock may not be liquid.

 

BECAUSE OUR SECURITIES MAY BE SUBJECT TO PENNY STOCK RULES, YOU MAY HAVE DIFFICULTY RESELLING YOUR SHARES.

 

Since our stock may be subject to penny stock rules, you may have difficulty reselling your shares. Penny stocks are covered by section 15(g) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell the Company's securities including the delivery of a standardized disclosure document; disclosure and confirmation of quotation prices; disclosure of compensation the broker/dealer receives; and, furnishing monthly account statements. For sales of our securities, the broker/dealer may be required to make a special suitability determination and receive from its customer a written agreement prior to making a sale. The imposition of the foregoing additional sales practices could adversely affect a shareholder's ability to dispose of his stock.

 

THIS REGISTRATION STATEMENT CONTAINS FORWARD LOOKING STATEMENTS WHICH ARE SPECULATIVE IN NATURE.

 

This registration statement contains forward-looking statements. These statements relate to future events or our future financial performance. Forward looking statements are speculative and uncertain and not based on historical facts. Because forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including those discussed under "Business Description" and "Corporate Background" Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, future results, levels of activity, performance, or achievements cannot be guaranteed. The reader is advised to consult any further disclosures made on related subjects in our future SEC filings.

WE ARE AN "EMERGING GROWTH COMPANY" AND WE CANNOT BE CERTAIN WHETHER THE REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES WILL MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS.

We are an "emerging growth company," as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding an annual non-binding advisory vote on executive compensation and nonbinding stockholder approval of any golden parachute payments not previously approved.  We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions.  If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.  In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.  However, we are choosing to opt out of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies.  Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

WE HAVE NOT PAID, AND DO NOT INTEND TO PAY, CASH DIVIDENDS IN THE FORESEEABLE FUTURE.

 

We have not paid any cash dividends on our common stock and do not intend to pay cash dividends in the foreseeable future. We intend to retain future earnings, if any, for reinvestment in the development and expansion of our business. Dividend payments in the future may also be limited by other loan agreements or covenants contained in other securities that we may issue. Any future determination to pay cash dividends will be at the discretion of our board of directors and depend on our financial condition, results of operations, capital and legal requirements and such other factors as our board of directors deems relevant.

 

11


 

 

 

USE OF PROCEEDS

 

The selling stockholders are selling shares of common stock covered by this prospectus for their own account. We will not receive any of the proceeds from the resale of these shares. We have agreed to bear the expenses relating to the registration of the shares for the selling security holders.

 

DETERMINATION OF OFFERING PRICE

 

Since our shares are not listed or quoted on any exchange or quotation system, the offering price of the shares of common stock was arbitrarily determined. The offering price was determined by the price shares were sold to our shareholders in our private placement pursuant to an exemption under Rule 144 of the Securities Act of 1933.

 

The offering price of the shares of our common stock has been determined arbitrarily by us and does not necessarily bear any relationship to our book value, assets, past operating results, financial condition or any other established criteria of value. The facts considered in determining the offering price were our financial condition and prospects, our limited operating history and the general condition of the securities market. Although our common stock is not listed on a public exchange, we will be filing to obtain a listing on the Over The Counter Bulletin Board (OTCBB) after the SEC declares this prospectus effective. In order to be quoted on the Bulletin Board, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved.

 

In addition, there is no assurance that our common stock will trade at market prices in excess of the initial public offering price as prices for the common stock in any public market which may develop will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity.

 

DILUTION

 

The common stock to be sold by the selling shareholders is common stock that is currently issued. Accordingly, there will be no dilution to our existing shareholders.

 

SELLING SECURITY HOLDERS

 

The shares being offered for resale by the selling stockholders consist of the 469,298 shares of our common stock held by 34 shareholders of our common stock, 250,000 shares of which sold in our Private offering through August of 2013; 135,798 shares which were issued as a dividend and 83,500 shares were issued for services rendered to the Company.

 

The following table sets forth the name of the selling stockholders, the number of shares of common stock beneficially owned by each of the selling stockholders as of September 30, 2013 and the number of shares of common stock being offered by the selling stockholders. The shares being offered hereby are being registered to permit public secondary trading, and the selling stockholders may offer all or part of the shares for resale from time to time. However, the selling stockholders are under no obligation to sell all or any portion of such shares nor are the selling stockholders obligated to sell any shares immediately upon effectiveness of this prospectus. All information with respect to share ownership has been furnished by the selling stockholders.

 

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Name of Selling Stockholder   Shares of Common Stock Owned Prior to Offering   Shares of Common Stock to be Sold   Shares of Common Stock Owned After Offering
                         
Janice Douglas     251,500       251,500       0  
Peggy Bradley     1,000       1,000       0  
Katherine Bleuer     500       500       0  
John Brand     500       500       0  
Stephen Deckard     500       500       0  
Richard Hernandez     1,000       1,000       0  
Scott Fountain     500       500       0  
Drew Fountain     500       500       0  
Fremont James Bellinger     500       500       0  
Darlene Newell     1,500       1,500       0  
Leland Hertel     500       500       0  
Karen Nelson     500       500       0  
Robyn Johns     1,000       1,000       0  
Sandra Jolicoeur     1,000       1,000       0  
Yvonne Boggs     1,500       1,500       0  
LaVonne Johnson     1,000       1,000       0  
Jose Rios     800       800       0  
Mercer Group*     8,000       8,000       0  
Hannah Grabowski     37,500       37,500       0  
Brianna Stoecklein     40,000       40,000       0  
Lannelle Cannon     15,000       15,000       0  
Wayne Berian     15,000       15,000       0  
Annette Mason     5,000       5,000       0  
Stan Windhorn     50       50       0  
Hans Johns     50       50       0  
A. Healey Mendicino     50       50       0  
Casey Johns     50       50       0  
Samantha Johns     50       50       0  
Chad Langner     50       50       0  
David Moriyama     50       50       0  
William Castleberry     50       50       0  
Steve Lynch     3,798       3,798       0  
Kyle Grabowski     300       300       0  
Blue Sky Media Corporation*     80,000       80,000       0  

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*Mercer Group, President, Andrew Mercer (who has voting rights and dispositive power with regards to the shares held by Mercer Group).

*Blue Sky Media Corporation, President, Hannah Grabowski (who has voting rights and dispositive power with regards to the shares held by Blue Sky Media Corporation).

 

With the exception of Blue Sky Media Corporation which was prepaid for a marketing video for the Company with 80,000 shares valued at $.10 per share; to our knowledge, none of the selling shareholders or their beneficial owners:

 

- has had a material relationship with us other than as a shareholder at any time within the past three years; or
   
- has ever been one of our officers or directors or an officer or director of our predecessors or affiliates
   
- are broker-dealers or affiliated with broker-dealers.

 

PLAN OF DISTRIBUTION

 

The selling security holders may sell some or all of their shares at a fixed price of $1.00 per share until our shares are quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices. Prior to being quoted on the OTCBB, shareholders may sell their shares in private transactions to other individuals. Although our common stock is not listed on a public exchange, we will be filing to obtain a listing on the Over the Counter Bulletin Board (OTCBB) when this Registration Statement is declared effective by the SEC. In order to be quoted on the Bulletin Board, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved. However, sales by selling security holders must be made at the fixed price of $1.00 until a market develops for the stock.

 

The Selling Stockholder and intermediaries through whom such securities are sold may be deemed "underwriters" within the meaning of the Securities Act  of 1933, as amended (the "Securities Act"), in which event profits, discounts or commissions received by such persons may be deemed to be underwriting commissions under the Securities Act.

 

REGULATION M We plan to advise the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling security holders and their affiliates. Regulation M under the Exchange Act prohibits, with certain exceptions, participants in a distribution from bidding for, or purchasing for an account in which the participant has a beneficial interest, any of the securities that are the subject of the distribution. Accordingly, the selling stockholders are not permitted to cover short sales by purchasing shares while the distribution it taking place. Regulation M also governs bids and purchases made in order to stabilize the price of a security in connection with a distribution of the security.

 

All expenses of the registration of securities covered by this Prospectus are to be borne by the Company, except that the selling stockholders will pay any applicable underwriters' commissions, fees, discounts or concessions or any other compensation due any underwriter, broker or dealer and expenses or transfer taxes.

 

Once a market has been developed for our common stock, the shares may be sold or distributed from time to time by the selling stockholders directly to one or more purchasers or through brokers or dealers who act solely as agents, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, which may be changed. The distribution of the shares may be effected in one or more of the following methods:

 

    1   ordinary brokers transactions, which may include long or short sales,
         
    2   transactions involving cross or block trades on any securities or market where our common stock is trading, market where our common stock is trading,
         
    3   through direct sales to purchasers or sales effected through agents,
         
    4   through transactions in options, swaps or other derivatives (whether exchange listed of otherwise), or exchange listed or otherwise), or
         
    5   any combination of the foregoing.

 

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In addition, the selling stockholders may enter into hedging transactions with broker-dealers who may engage in short sales, if short sales are permitted, of shares in the course of hedging the positions they assume with the selling stockholders. The selling stockholders may also enter into option or other transactions with broker-dealers that require the delivery by such broker-dealers of the shares, which shares may be resold thereafter pursuant to this prospectus.

 

Brokers, dealers, or agents participating in the distribution of the shares may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of shares for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensation as to a particular broker-dealer may be in excess of customary commissions). Neither the selling stockholders nor we can presently estimate the amount of such compensation. We know of no existing arrangements between the selling stockholders and any other stockholder, broker, dealer or agent relating to the sale or distribution of the shares. We will not receive any proceeds from the sale of the shares of the selling security holders pursuant to this prospectus. We have agreed to bear the expenses of the registration of the shares, including legal and accounting fees, and such expenses are estimated to be approximately $11,660.45.

 

DESCRIPTION OF SECURITIES TO BE REGISTERED.

 

General

 

Our authorized capital stock consists of 75,000,000 Shares of common stock, $0.001 par value per Share. There are no provisions in our charter or by-laws that would delay, defer or prevent a change in our control.

 

Common Stock

 

We are authorized to issue 75,000,000 shares of common stock, $0.001 par value per share. At the three month period ending December 31, 2013 we had 6,789,298 common shares issued and outstanding held by 35 shareholders which includes the restricted shares held by David Funderburk. We do not have any holding period requirements for our common stock.

 

The holders of our common stock have equal ratable rights to dividends from funds legally available if and when declared by our board of directors and are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs. Our common stock does not provide the right to a preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights. Our common stock holders are entitled to one non-cumulative vote per share on all matters on which shareholders may vote.

 

We refer you to our Articles of Incorporation, Bylaws and the applicable statutes of the state of Nevada for a more complete description of the rights and liabilities of holders of our securities. All material terms of our common stock have been addressed in this section.

 

Holders of shares of our common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose, and, in that event, the holders of the remaining shares will not be able to elect any of our directors.

 

Dividends

 

We have not paid any cash dividends to shareholders. The declaration of any future cash dividends is at the discretion of our board of directors and depends upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.

 

Warrants

 

There are no outstanding warrants to purchase our securities.

 

Options

 

There are no options to purchase our securities outstanding.

 

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No Public Market for Common Stock

 

There is presently no public market for our common stock. We anticipate applying for trading of our common stock on the over the counter bulletin board, upon the effectiveness of the registration statement of which this prospectus forms a part.

 

          There are several requirements for listing our shares on the OTC bulletin board, including:

 

          * we must make filings pursuant to Sections 13 and 15(d) of the Securities Exchange Act of 1934;

 

          * we must remain current in our filings;

 

          * we must find a member of FINRA to file a form 211 on our behalf. The information contained within form 211 includes comprehensive data about our company and our shares. Form 211 and our prospectus are filed with a Brokerage Firm so that they can determine if there is sufficient publicly available information about us and whether our shares should be listed for trading.

 

We can provide no assurance that our shares will be traded on the bulletin board or, if traded, that a public market will materialize.

 

No Broker Is Being Utilized In This Offering

 

This offering does not involve the participation of an underwriter or broker, and as a result, no broker for the sale of our securities will be used. In the event a broker-dealer is retained by us to participate in the offering, we must file a post-effective amendment to the registration statement to disclose the arrangements with the broker-dealer, and that the broker-dealer will be acting as an underwriter and will be so named in the prospectus.

 

No Escrow of Proceeds

 

There will be no escrow of any of the proceeds of this offering since the Company has already received all proceeds from its Private Placement. Accordingly, we already have use of all funds we have raised. These funds shall be non-refundable to subscribers except as may be required by applicable law.

 

Penny Stock Reform Act of 1990

 

The Securities Enforcement and Penny Stock Reform Act of 1990 require additional disclosure for trades in any stock defined as a penny stock. The Securities and Exchange Commission has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to exceptions. Under this rule, broker/dealers who recommend these securities to persons other than established customers and accredited investors must make a special written suitability determination for the purchaser and receive the purchaser's written agreement to a transaction before sale. Our shares will probably be subject to the Penny Stock Reform Act, thus potentially decreasing the ability to easily transfer our shares.

 

 

 

INTERESTS OF NAMED EXPERTS AND COUNSEL

 

No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.

 

The financial statements included in this prospectus and the registration statement have been audited by Kyle L. Tingle, CPA, LLC, to the extent and for the period set forth in their report appearing elsewhere herein and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

 

Mont E Tanner, Attorney at Law, has rendered an opinion as to the validity of shares being registered and the corporate documents of the Company.

 

 

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DESCRIPTION OF BUSINESS

 

Company Overview

 

Autovative Technologies, Inc. is a distributor of automotive parts. We have developed and produced two products in conjunction with OTW Enterprises LLC for both automobile and fleet uses and subsequently engaged OTW Enterprises LLC for the manufacturing of the products, whereby we have elected to be a reseller of the products. One product is the Portable Tow Truck, a traction aid which has been successful in helping drivers get their vehicles unstuck from snow, ice, mud and sand. The unit price for the Portable Tow Truck varies and sells in the $20-$30 range. The other product is the Overhead Door Saver, a heavy-duty spring device for use in fleets of trucks with overhead doors. It cushions the shock of constant door openings, and greatly reduces overhead door repairs. The price for the Overhead Door Saver is in the $30 range.

 

We were incorporated in Nevada on December 10, 2012. We have contracted for the manufacturing of both products listed above with OTW Enterprises LLC, located in Maryville, Tennessee. The first product, the Portable Tow Truck, has been marketed exclusively by us to the large fleet market for the past seven years, and has had continual sales to UPS (United Postal Service), FedEx (Federal Express) and others. The Overhead Door Saver has been successfully tested by UPS on some of its vehicles. At this time the Company awaits a contract with UPS, as they are considering installing it on all their vehicles with overhead doors. At this time we do not know with certainty whether they will or will not enter into a contractual arrangement with the Company. We intend to expand our marketing of the Portable Tow Truck to retail outlets worldwide, and expand the marketing of the Overhead Door Saver to companies with large truck fleets with overhead doors.

 

In August of 2013 Autovative Technologies, Inc. contracted with Green Meadow Products, Inc. for the rights to enable Green Meadow Products, Inc. to sell the Portable Tow Truck Units to retail outlets in the states of Wyoming, Montana, South Dakota and North Dakota for an agreed upon one time price of $15,000 with no royalties built into the contract. AT is currently in negotiations to sell the rights to additional territories with Green Meadow Products, Inc.

 

All products sold by the Company are drop shipped (meaning that when an order is placed by a customer the product is shipped directly to the customer by the manufacturer rather than to the Company and then to the customer) by the manufacturer in Maryville, TN to the customer.

 

Business Strategy

 

To date we have only attempted to sell our products to trucking fleets such as FedEx and UPS. We believe that with the past sales of our products to two large trucking fleets such as FedEx and UPS we should have an advantage to selling to additional trucking fleets as well as to the retail markets. However there is no assurance that will happen.

 

We intend to enter into alliances with other companies with innovative automobile products, especially focusing on products adapted to future trends in the automotive industry. Additionally, we intend to enter into alliances with companies that have domestic and international marketing and distribution outlets. We believe when this is successfully completed, it will provide profitability and self-sustaining growth. We plan to do this by:

 

Establishing manufacturing alliances with manufacturers, both domestically and abroad, to mass produce our products:

 

Finding a manufacturer that can manufacture larger volumes at cheaper prices while maintaining quality control should increase our profit margins. We believe that in order to accomplish this will require a combination of larger orders and additional capital, neither of which are at our disposal currently.

 

In our opinion we would require orders of at least 10,000 units annually of the Portable Tow Truck to have the units manufactured at a different manufacturing plant other than the manufacturing facility we are currently using. Mold costs alone are estimated by management to be $50-75,000. In addition we believe would have to order a minimum of 5,000 units per order to be cost effective. We believe the cost per unit savings by changing manufacturing plants could be as much as 30% over the current cost paid per unit for the Portable Tow Truck units. Total cost to make the manufacturing change could be as high as $125,000 (inclusive of the molds and the 5,000 unit minimum order). The Company would require additional sales and capital in order to accomplish this projection. There are no plans in place currently to raise additional capital without which we would be unable to consider changing manufacturers.

 

Developing a marketing and sales force to successfully market and sell our products both domestically and globally:

 

We believe that if we become financially able to hire a sales force that our sales would increase; although there is no assurance that would happen. We recognize that to hire a sales force will take additional capital which we have estimated to be $3,000 per month.

 

We have recently hired sales people on a commission only basis in Southern California, Idaho and Arizona to sell both the Portable Tow Truck units and the Overhead Door Saver units to commercial trucking fleets like the trucks used by UPS and FedEx. Currently all sales people are not contracted by the Company nor are employees of the Company. The Company has no employees with the exception of its President, David Funderburk. When a sale is made and revenue is received from the customer, commissions are paid to the person responsible for the sale.

 

We have projected to add one (1) sales person at some point in the fiscal year 2014 on a full time basis at a salary plus commission's basis of $3,000 each per month, equating to a total of $36,000 annually. However this will require additional capital, which based on our current revenue stream, would have to come from raising additional capital. At this time there is no definitive plan in place to raise additional capital without which we would be unable to hire a full time sales person.

 

We anticipate that the full time sales person would generate revenues through sales of the Overhead Door Saver and the Portable Tow Truck units to trucking fleet markets. There is no assurance that we will be able to hire a sales person in the timeframe we have projected (sometime in 2014), or that we might ever be in a financial position to hire a full time sales person and there is no assurance once hired that person would make any sales.

 

Establishing a retail oriented website oriented toward both trucking fleet sales and retail sales of the Portable Tow Truck.:

 

We plan to change our website, www.autovativeproducts.com, in the second quarter of 2014 to orient it towards both the trucking fleet market and the retail market. The retail market orientation would focus on individual units sold to car, truck, SUV, and off-road enthusiasts. We believe that the cost of developing a merchant web-site capable of taking credit cards on-line would cost anywhere from $1,000 to $5,000 annually. We are aware that there could be a conflict with our retail sales vs. the retail sales made by the manufacturer's website, www.theportabletowtruck.com. Currently any sales made through the manufacturer's website are the manufacturer's. Any sales whether retail, wholesale or fleet sales made by us are our sales.

 

The trucking fleet part of the web-site would be oriented towards explaining the Portable Tow Truck units and the Overhead Door saver units through textual context as well as photos and videos of the use of the products.

 

 

  Establishing marketing alliances with companies with worldwide marketing outlets:

 

We are currently seeking marketing alliances. At this time we have none in place. We anticipate that a full time sales representative would make sales

 

We anticipate that a full time sales person would generate revenues through sales of the Portable Tow Truck units to the (1) traditional, (2) retail and (3) OES (Original Equipment Supplier) channels. Traditional channels would include brand name distributors, retail channel would include brand name auto retail merchants, and the OES (Original Equipment Supplier) channel would consist primarily of vehicle manufacturers' service departments at new vehicle dealerships. There is no assurance that we will be able to hire a sales person in the timeframe we have projected (sometime in 2014) at a cost of $3,000 a month, or that we might ever be in a financial position to hire a full time sales person and there is no assurance once hired that person would make any sales through the above mentioned channels.

 

 

Establishing distribution outlets globally through alliances with companies with those locations established, including capability to establish more outlets:

 

We are currently seeking larger distribution outlets that cater to trucking fleets, at this time we have none in place.

 

We project that establishing such distribution outlets would be accomplished through the hiring of additional sales staff as outlined in the paragraph above entitled "Developing a marketing and sales force to successfully market and sell our products both domestically and globally". We recognize that to hire a sales force will take additional capital which we have estimated as previously noted to be at least $3,000 per month.

 

We have projected to add one (1) sales person at some point in the fiscal year 2014 on a full time basis at a salary plus commission's basis of $3,000 each per month, equating to a total of $36,000 annually. However this will require additional capital, which based on our current revenue stream, would have to come from raising additional capital. At this time there is no definitive plan in place to raise additional capital without which we would be unable to hire a full time sales person.

 

We anticipate that the full time sales person would not only generate revenues through sales of the Overhead Door Saver and the Portable Tow Truck units to trucking fleet markets; but also by establishing distribution outlets globally through alliances with companies with those locations established, including capability to establish more outlets. There is no assurance that we will be able to hire a sales person in the timeframe we have projected (sometime in 2014), or that we might ever be in a financial position to hire a full time sales person and there is no assurance once hired that person would make any sales or establish any additional distribution outlets.

 

 

Continuing to test and improve our products, including locating additional testing facilities:

 

UPS has been testing our Overhead Door Saver for the last year. We believe that if we can establish other trucking fleets that would test the unit we might increase our revenues. We are currently seeking additional trucking lines for testing purposes.

 

Adding new product lines:

 

Currently we are focused on selling our existing products. However it is our goal to add additional products that we might be able to sell to our existing customers and subsequently expand our markets. We are currently undercapitalized to add new products at this time and there is no assurance that we will be able to add products in the future, nor do we have any specific products in mind currently to add to our existing product line. There is no timeline for seeking new products because the variables in the market, the ability to locate funds, the need to develop a strong and consistent distribution network and public acceptance, just to name a few, are too many and diffuse to reasonably establish a timeline

 

Although this strategy is our plan for future growth, at this date we have no definitive arrangement with any other manufacturers for any other product lines. Nor do we have any other marketing alliances in place, nor do we have the capital available to fund any of the above mentioned plans. All of these steps will require additional capital.

 

Based on the assumption that we will be able to raise additional capital we have projected that we would need a minimum of $50,000 to reach the goals of our Business Strategy and an optimum of $200,000. To accomplish these goals the Company will need to raise additional capital. At this time there is no plan in place to raise additional capital nor is their any assurance that we will be able to raise additional capital.

 

Industry Overview

 

According to JD Power and Associates, there were a total of one billion light, medium and heavy duty vehicles registered worldwide in 2009. Approximately 259 million, or 25%, of these vehicles were registered in the United States. According to the AAIA (Automotive Aftermarket Industry Association), the overall size of the U.S. aftermarket was approximately $274 billion in 2009.

In general, aftermarket industry participants can be categorized into three major groups: (1) manufacturers of parts, (2) distributors of replacement parts (without manufacturing capabilities) and (3) installers, both professional and DIY(Do It Yourself) customers. Distributors purchase products from manufacturers and sell them to wholesale or retail operations, which in turn sell them to installers.

The distribution business is comprised of the (1) traditional, (2) retail and (3) OES channels. Typically, professional installers purchase their products through the traditional channel, and DIY customers purchase products through the retail channel. The traditional channel includes well-known distributors of auto related parts. Through a network of distribution centers, these distributors sell primarily to owned or affiliated stores, which in turn supply professional installers. The retail channel includes well known retail merchants of auto related parts. The OES (Other Equipment supplier) channel consists primarily of vehicle manufacturers' service departments at new vehicle dealerships.

 

There are numerous tire traction aid devices on the market, most of which are designed to go around the tires and be used continuously while driving in weak traction areas such as snow, ice, mud and sand. These types of devices are designed to prevent a vehicle from getting stuck, and are not designed to get a vehicle unstuck. There are some traction mat devices similar to our Portable Tow Truck, but to our knowledge none that have our cleat design. The major sales of these devices occur during the winter and rainy seasons, with fewer sales during the dry months.

 

To our knowledge there are no similar devices to our Overhead Door Saver currently on the market. Some fleet owners have attempted to place a door stop on the overhead door track in the hopes of reducing door repairs, but these have proven to be of little effect. We believe that the Overhead Door Saver would reduce overhead door repairs.

 

Currently we are selling the Portable Tow Truck directly to two large fleet lines, UPS and FedEx. Our goal is to also sell through means mentioned above: (1) traditional, (2) retail and (3) OES channels; in addition to the sales we are currently making. We recognize that we will need to raise additional capital to accomplish that goal. As of now we have no plan in place for raising additional capital.

 

Our Products and Technology

 

Portable Tow Truck

 

The Portable Tow Truck was developed and is owned by OTW Enterprises LLC. We have contracted with OTW Enterprises LLC for the marketing and distribution rights as a reseller (See "Exhibit 10.1"). The Portable Tow Truck is made of rigid polypropylene. Each section (there are two sections, one for each rear tire) is 8 inches wide and 36 inches long, and weighs 2.5 pounds. They have two holes on the top portion to provide attachment to the vehicle, and are designed for easily handling and consume very little trunk space. They have been tested to perform at 40 degrees below zero, and are designed to last for a number of years, depending on how much they are used.

 

We have continued to have positive response from both FedEx and UPS regarding the Portable Tow Truck. We have no ongoing contract for the sale of the product to any Company, inclusive of FedEx and UPS yet both Companies combined make up 98% of our sales as they continue to return to purchase the Portable Tow Truck.

 

We believe that once we implement our business strategy as defined above we will be able to sell the product to additional large trucking fleets as well as automotive parts stores, and the larger retail outlets such as Wal-Mart, and Target. At this time we do not know how successful we might be at selling to other large trucking fleets or the retail markets.

 

We have contracted with Green Meadow Products, Inc. for the rights to enable Green Meadow Products, Inc. to sell the Portable Tow Truck Units to retail outlets in the states of Wyoming, Montana, South Dakota and North Dakota for an agreed upon one time price of $15,000 with no royalties built into the contract. AT is currently in negotiations to sell the rights to additional territories with Green Meadow Products, Inc.

 

Overhead Door Saver

 

The Overhead Door Saver was developed and is owned by OTW Enterprises LLC. We have contracted with OTW Enterprises LLC for the marketing and distribution rights as a reseller (See "Exhibit 10.1").The Overhead Door Saver is manufactured from various steel parts. The mounting piece (which is bolted to the track of the overhead door) is 3" steel flat bar which has three holes punched in it, and then is bent into a U shape. The rod which goes through the U support is made from hot-rolled ½" steel and has a 2"X2 ½" flat steel piece welded on one end. A 10" long engineered steel spring is placed over the rod and then inserted through the holes on the U support. A 2" long engineered steel spring is placed on the back end of the rod, with a bolt behind it welded to the rod. The assembled unit is then painted and baked (plated) to prevent rust and to assure a long-lasting product. Left-hand and right-hand units are produced, and both units are then bolted to the overhead door track, one on each side.

 

Competition

 

Portable Tow Truck

 

There are other devices on the market designed to either assist drivers to prevent their vehicles from getting stuck in snow, ice, mud or sand, or to assist in extracting the vehicles when they get stuck. The Portable Tow Truck is designed to assist in the latter category. The devices designed to prevent vehicles from getting stuck must be applied around the tires prior to traveling in weak traction areas. Devices designed to extract vehicles when stuck are not put around the tires, but instead are placed on the ground directly in front of the rear (driving) tires and pushed down against the tires. This is the category of traction-aid product in which we would be in competition, and not the former category.

 

Although we have a contract for the exclusive rights for sales of the Portable Tow Truck and the Overhead Door Saver, there currently is another Company with the website name www.theportabletowtruck.com that sells the Portable Tow Truck on a retail only basis. The Company is owned by the manufacturer of the Portable Tow Truck units that we currently sell for commercial use. They are not affiliated with our company and sell the Portable Tow Truck strictly on a retail basis though their Company website. A verbal agreement was reached between us and the Manufacturer of the products whereby the Manufacturer could make retail sales but only through their web site www.theportabletowtruck.com. This agreement could affect our ability to penetrate the retail markets and it could confuse retail buyers that we may generate through our web site or any other means. This could affect our ability to generate revenues through the retail marketplace

 

Overhead Door Saver

 

It is management's belief that the Overhead Door Saver would reduce repairs to overhead doors in trucking fleets. Management is unaware of a similar device on the market designed to reduce the repairs on overhead doors.

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Competitive Advantages

 

The Portable Tow Truck has several competitive advantages over other similar traction-aid devices on the market. Some of the devices designed to extract stuck vehicles are flat and some have ridges to assist with traction. To our knowledge the Portable Tow Truck is the only traction-aid product on the market with many small sharp cleats on the top and bottom that both grab the tire and also dig into and hold on to the ground surface. This is a major advantage in providing a firm grip to the tire as well as the ground surface. The front cleats face the opposite direction, which further aids on the initial connection to the tire. Also, in the opinion of management, the Portable Tow Truck is the only traction-aid product on the market with small holes in front to enable it to be connected to the vehicle so it can be dragged to an area that is safe to stop.

 

Customers

 

Portable Tow Truck

 

Currently, and continuously for the past seven years (through API and as ATI), we have had sales of the Portable Tow Truck to UPS, FedEx and other fleet owners. These sales have averaged over 5,000 units per year, and those sales are expected to continue. We plan to mass market our product to retail and wholesale outlets throughout the U.S. and Canada, as well as globally. With that we hope to have customers worldwide.

 

Because we are considered a small vendor to FedEx, our sales to the FedEx trucking fleet are made through Johnson Industries, Inc. in Norcross, Georgia. Johnson Industries, Inc. is a distributor of automotive industry parts and equipment from which FedEx has elected to purchase parts for its fleets rather than going to individual Manufacturers for each part. We sell the products ordered by FedEx to Johnson Industries, Inc. and are paid by Johnson Industries, Inc. We have no knowledge as to what Johnson Industry's financial arrangements are with any of its customers including FedEx. Sales to UPS are made directly to UPS.

 

Overhead Door Saver

 

Our Overhead Door Saver has been tested at UPS centers. And although management believes that the tests show a reduction in overhead door repairs no sales of the unit have been made to date. Management further believes that the product introduced and tested by a trucking fleet, whether UPS or another trucking fleet, that can see the benefits of a reduction of overhead trucking door repairs may desire to install the unit on its entire fleet of trucks. As such we will continue to attempt to market the Overhead Door Saver to trucking fleets along with the Portable Tow Truck units.

 

Intellectual Property

 

We do not have patents on either the Portable Tow Truck or the Overhead Door Saver.

 

A patent was applied for regarding the Overhead Door Saver which was denied due to the fact that there was an existing patent for the basic technology which we applied for, although for a different use.

                     

We explored filing a patent for the Portable Tow Truck but did not file a patent for the Portable Tow Truck.

 

 

Government Regulations

 

To our knowledge there are no current government regulations concerning or affecting either of our products.

 

Research and Development

 

Portable Tow Truck

 

Our research and development activities have been in the creation and testing of various materials to use in the molds, as well as development of the molds themselves. Live tests we conducted using both cars and trucks in snow, ice, mud and sand conditions, and modifications to the materials and to the mold design were made. After numerous tests, the current product emerged.

 

If our markets expand we intend to search for a manufacturer that will be more cost effective whether it is on or offshore.

 

Overhead Door Saver

 

Our research and development activities with this product began by creating a design that could be applied to the rails of overhead doors, without causing any conflicts with the use of the doors, or with the use of the cargo space. We then tested various sizes of steel materials and configurations, and finally tested a number of steel spring sizes. After being unsuccessful in procuring ready-made springs that would perform properly, we had special steel springs engineered to meet our specifications. Those springs were tested on various trucks, and have performed perfectly since our first tests. None of our Overhead Door Savers that have been tested in use of the UPS trucks have broken or malfunctioned in the time tested.

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Employees

 

Our President, David Funderburk, is paid a salary of $2,500 per month which began being paid in September 2013. We have two sales people working with the Company who are not contracted by the Company nor are they employed by the Company. They are paid a commission only based on revenues received from sales made by them. We plan to hire additional employees and sales force on an as needed basis and as the Company's growth expands in the areas of sales, administration and product assembly. As we further develop and market our products, we will need to hire additional employees.

 

Office and Facilities

 

Our executive offices are located at 1010 Industrial Road #70 Boulder City, NV 89005. Our telephone number at that address is 760-732-5868, and our facsimile number is 760-301-0005. The manufacturing facilities are located in Maryville, TN, where we currently contract with independent laborers to produce, assemble and package our products.

  

Regulation

 

Our businesses could be regulated by governmental authorities in the jurisdictions in which we operate. Because of the possibility of international operations, we must comply with diverse and evolving regulations. Regulation relates to, among other things, management, licensing, foreign investment, use of confidential customer information and content. Our failure to comply with all applicable laws and regulations could result in, among other things, regulatory actions or legal proceedings against us, the imposition of fines, penalties or judgments against us or significant limitations on our activities. In addition, the regulatory environment in which we operate is subject to change. New or revised requirements imposed by governmental authorities could have adverse effects on us, including increased costs of compliance. Changes in the regulation of our operations or changes in interpretations of existing regulations by courts or regulators or our inability to comply with current or future regulations could adversely affect us by reducing our revenues, increasing our operating expenses and exposing us to significant liabilities. Our business involves risks of liability associated with automotive specialty products, which could adversely affect our business, financial condition or results of operations. As a developer and distributor of automotive specialty products, we may face potential liability for any of:

 

  defamation;
  invasion of privacy;
  copyright infringement;
  actions for royalties and accountings;
  trademark misappropriation;
  trade secret misappropriation;
  breach of contract;
  negligence; and/or
  other claims based on the nature and content of the materials distributed.

          

These types of claims have been brought, sometimes successfully, against merchandisers, online services and other developers and distributors of automotive products. We could also be exposed to liability in connection with material available through our Internet sites. 

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Reports

 

As an issuer whose securities will be registered under section 15(d) of the Exchange Act, we will be required to file periodic reports with the SEC. The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street N.E., Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330 or 1- 202-942-8090. The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. The address of that site is http://www.sec.gov.

 

Bankruptcy or Receivership or Similar Proceedings

 

None

 

Legal Proceedings

 

Neither the Company nor any of its officers, directors or beneficial shareholders (greater than 10%) are involved in any litigation or legal proceedings involving the business of the Company.

 

 

 

 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

Some of the statements under the "Prospectus Summary," "Risk Factors," "Management Discussion and Analysis", "Business Description" and elsewhere in this prospectus constitute forward-looking statements. The "safe harbor" for forward-looking statements does not apply to this offering since it is an initial public offering of our securities. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievement expressed or implied by such forward-looking statements. Such factors include, among other things, those listed under "Risk Factors" and elsewhere in this prospectus.

 

In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "intend", "expects," "plan," "anticipates," "believes," "estimates," "predicts," "potential," or "continue" or the negative of such terms or other comparable terminology.

 

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We are under no duty to update any of the forward-looking statements after the date of this prospectus.

 

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

 

Executive Officers and Directors

 

The following table and subsequent discussion contains the complete and accurate information concerning our directors and executive officers, their ages, term served and all of our officers and their positions, who will serve in the same capacity with us upon completion of the offering.

 

Name   Age   Term Served   Title / Position(s)
David Funderburk   66  

Since inception

(December 10, 2012)

  President, Secretary, Treasurer and Director
             

         

 There are no other persons nominated or chosen to become directors or executive officers nor do we have any employees other than above.

 

DAVID FUNDERBURK

 

David Funderburk, is the founder and Director of Autovative Technologies, Inc.. Mr. Funderburk has been the sole officer and sole director since its inception. Mr. Funderburk graduated from the University of San Diego with a Master's Degree and began his business career analyzing and developing training programs for the U.S. Government. He then began building custom homes in San Diego County as a general contractor and owner of North County Domes, after which he became an independent real estate consultant and investor. Mr. Funderburk has served as a fiduciary and trustee for numerous trusts, and has served as an Officer of several non-public corporations. Since 1990 he has applied his study of contract and business law towards developing business strategies for clients. Mr. Funderburk, was President of Autovative Products, Inc., the parent Company of Autovative Technologies, Inc. for eight(8) years, since the company's inception in 2005 until January 1, 2013. He was both instrumental in developing the Company's products as well as aiding in the marketing of the products to two large trucking fleets, UPS and FedEx. His experience with marketing to those companies could be invaluable in establishing sales to other large trucking fleets in the future. His knowledge of the Company and its products and market should enhance his ability as an Officer and Director.

20


 

 Our directors will hold office until the next annual meeting of shareholders and the election and qualification of their successors. Directors receive no compensation for serving on the board of directors other than reimbursement of reasonable expenses incurred in attending meetings. Officers are appointed by the board of directors and serve at the discretion of the board.

 

No officer, director, or persons nominated for such positions and no promoters or significant employee of AUTOVATIVE TECHNOLOGIES, INC. has been involved in legal proceedings that would be material to an evaluation of officers and directors.

 

Executive Compensation

Summary Compensation Table:

  

Name and Principal Position   Year

Salary

($)

Bonus

($)

Stock

Awards

($)

Option

Awards

($)

Non-Equity Incentive Plan Compensation ($)

Non-Qualified Deferred Compensation Earnings

($)

Commissions

($)

Totals

($)

David Funderburk,

President(4)

  2012     720.00(1)         720.00
                     

David Funderburk,

President(4)

  2013 2,500(2)   5,000.00(3)         7,500.00

 

Option Grants Table. There were no individual grants of stock options to purchase our common stock made to the executive officer named in the Summary Compensation Table through September 30, 2013.

  

Compensation of Officers and Directors

 

(1) A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk were the only shares issued from Autovative Technologies, Inc.

 

(2)-David Funderburk has received compensation in the way of a salary of $2,500 per month which was initiated in September of 2013.

 

(3) Shares issued to David Funderburk at par value of $.001 for organizational procedures.

 

(4) David Funderburk, sole officer and Director, herein referred to as President.

 

Employment Agreements

 

We currently do not have any employment agreements in place with our officers or significant employees.

 

Indemnification of Directors and Officers

 

Except as permitted by the Nevada Revised Statutes, the Company's Articles of Incorporation do not provide for any additional or different indemnification procedures. At present, there is no pending litigation or proceeding involving a director, officer or employee of the Company regarding which indemnification is sought, nor is the Company aware of any threatened litigation that may result in claims of indemnification. The Company has not obtained director's and officer's liability insurance, although the board of directors of the Company may determine to investigate and, possibly, acquire such insurance in the future.

 

21


Employment Agreements

 

We have not entered into any employment agreements with any of our employees, and employment arrangements are all subject at the discretion of our President, David Funderburk.

 

Conflict of Interest - Management's Fiduciary Duties

 

Our directors and officers may become, in their individual capacity, officers, directors, controlling shareholders and/or partners of other entities engaged in a variety of businesses.

 

LEGAL PROCEEDINGS

 

We may from time to time be involved in routine legal matters incidental to our business; however, at this point in time we are currently not involved in any litigation, nor are we aware of any threatened or impending litigation.

 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

The table below sets forth, as of September 30, 2013, certain information with respect to the beneficial ownership of the common stock of our Company by each person who we know to be beneficial owner of more than 5% of any class or series of our capital stock, each of the directors and executive officers individually, and all directors and executive officers as a group. Unless otherwise indicated, each person named in this table has sole voting and investment power with respect to the shares beneficially owned.

 

Title of Class Name and Address of Beneficial Owner Amount and Nature of Beneficial Ownership Percent of Class
Common David Funderburk President

 

6,320,000

 

93%

       

 

Transfer Agent

 

We have not yet engaged a transfer agent, we have acted as our own transfer agent and registrar. Upon the effective notice of this registration statement the Company plans to engage a Transfer Agent. At this time it is unknown which transfer agent will be engaged.

22


 

RELATED PARTY TRANSACTIONS

 

All transactions that are reportable pursuant to Item 404(d)(1) are disclosed in this section.         

 

Since inception, the following transactions were entered into:

 

The Company's principal shareholder provides office space to the Company, on a month to month basis. The office space is not of material value to the Company and shall be available to the Company until such time as it needs and establishes its permanent office.

 

The Company has established its web site at: www.autovativeproducts.com.

 

The Company has completed a Private Placement of 250,000 of its common shares to 1 individual shareholder, at a price of $0.10 per share, which provided $25,000 in cash to the Company as of September 30, 2013.

 

All current shareholders acquired their shares with the intent to hold the shares for investment purposes and not with a view to further resale or distribution, except as permitted under exemptions from registration requirements under applicable securities laws. That means that they may not sell such securities unless they are either registered with the sec and comparable agencies in the states or other jurisdictions where the purchasers reside, or are exempted from registration. The most widely used exemption from registration requirements is provided by sec Rule 144, which requires a six month holding period prior to resale, and limits the quantities of securities that can be sold during any 90 day periods.

 

The certificate has been issued with a restrictive legend required with respect to issuance of securities pursuant to exemptions from registration requirements under the Securities Act and the recipient acknowledged his understanding that the shares are restricted from resale unless they were either registered under the Securities Act and comparable state laws, or the transaction was effected in compliance with available exemptions from such registration requirements.

 

It is contemplated that we may enter into certain transactions with our President, David Funderburk, or affiliates which may involve conflicts of interest in that they will not be arms' length transactions. We presently have no permanent office facilities but for the time being we will use as our business address the offices of Mr. Funderburk the operating manager, on a rent free basis, until such time as our business operations may require more extensive facilities and we believe it an appropriate time to rent commercial office space. There is presently no formal written agreement for the use of such facilities, and no assurance that such facilities will be available to us on such a basis for any specific length of time.

 

All future transactions between us and our officers, directors or 5% shareholders, and their respective affiliates, will be on terms no less favorable than could be obtained from unaffiliated third parties and will be approved by a majority of any independent, disinterested directors.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk constituted all of the issued and outstanding shares of API's subsidiary, Autovative Technologies, Inc. 

The Company issued 600,000 shares of restricted stock for $600 to its President.

 

The officer of the Company received no commissions for the year ended September 30, 2013.

 

After the closing with API, the Company changed compensation of the officer from commissions to payroll. The officer of the Company received wages of $2,500 for the year ended September 30, 2013.

 

 

There are currently no related party transactions between Mr. Funderburk and the Company other than those disclosed herein. Further, the Company has not had any preliminary contact or discussions with Funderburk or affiliates and there are no present plans, proposals, arrangements or understandings with these companies to enter into any future transactions.

 

DIRECTOR INDEPENDENCE 

Our board of directors is currently composed of one member, David Funderburk who does not qualify as an independent director in accordance with the published listing requirements of the NASDAQ Global Market. The NASDAQ independence definition includes a series of objective tests, such as that the director is not, and has not been for at least three years, one of our employees and that neither the director, nor any of her family members has engaged in various types of business dealings with us. In addition, our board of directors has not made a subjective determination as to each director that no relationships exists which, in the opinion of our board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director, though such subjective determination is required by the NASDAQ rules. Had our board of directors made these determinations, our board of directors would have reviewed and discussed information provided by the directors and us with regard to each director's business and personal activities and relationships as they may relate to our management and us.

 

 

23


 

DISCLOSURE OF PAYMENT OF SERVICES WITH SHARES OF COMMON STOCK

 

The following were compensated with common stock issued at the par value of $0.10 per share of the Company for services rendered; specifically contracted marketing services:

 

Blue Sky Media Corporation 80,000
Steve Lynch 3,500

 

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

 

Our certificate of incorporation contains provisions permitted under General Corporation Laws of Nevada relating to the liability of directors. The provisions eliminate a director's liability to stockholders for monetary damages for a breach of fiduciary duty, except in circumstances involving wrongful acts, including the breach of a director's duty of loyalty or acts or omissions, which involve intentional misconduct, or a knowing violation of law. Our certificate of incorporation also contains provisions obligating us to indemnify our directors and officers to the fullest extent permitted by General Corporation Laws of Nevada. We believe that these provisions will assist us in attracting and retaining qualified individuals to serve as directors.

 

We are subject to the State of General Corporation Laws of Nevada. In general, the statute prohibits a publicly held Nevada corporation from engaging in a business combination with a person who is an interested stockholder for a period of three years after the date of the transaction in which that person became an interested stockholder, unless the business combination is approved in a prescribed manner. A business combination includes a merger, asset sale or other transaction resulting in a financial benefit to the interested stockholder. An interested stockholder is a person who, together with affiliates, owns, or, within three years prior to the proposed business combination, did own 15% or more of our voting stock. The statute could prohibit or delay mergers or other takeovers or change in control attempts and accordingly, may discourage attempts to acquire us.

 

As permitted by Nevada law, we intend to eliminate the personal liability of our directors for monetary damages for breach or alleged breach of their fiduciary duties as directors, subject to exceptions. In addition, our bylaws provide that we are required to indemnify our officers and directors, employees and agents under circumstances, including those circumstances in which indemnification would otherwise be discretionary, and we would be required to advance expenses to our officers and directors as incurred in proceedings against them for which they may be indemnified. The bylaws provide that we, among other things, will indemnify officers and directors, employees and agents against liabilities that may arise by reason of their status or service as directors, officers, or employees, other than liabilities arising from willful misconduct, and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified. At present, we are not aware of any pending or threatened litigation or proceeding involving a director, officer, employee or agent of ours in which indemnification would be required or permitted. We believe that our charter provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

 

We have agreed to the fullest extent permitted by applicable law, to indemnify all our officers and directors.

 

We undertake the following:

 

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.

 

REPORTS TO SECURITY HOLDERS

 

AUTOVATIVE TECHNOLOGIES, INC. is not a reporting issuer under the Securities Exchange Act of 1934. As a result of this offering, we will become subject to the informational requirements of the 1934 Act for a period of at least one fiscal year.

 

FINRA requires that all issuers maintaining quotations of their securities on the OTC Bulletin Board file periodic reports under the 1934 Act. In order to maintain such a quotation, we will have to register our securities under the 1934 Act on Form 8-A or Form 10.

 

We may cease filing periodic reports with the Securities and Exchange Commission if:

 

We have less than 300 stockholders of record; or

We have less than 500, but more than 300, stockholders of record, and our total assets did not exceed $10 million on the last day of each of our three most recent fiscal years

 

Because of the requirement that we file periodic reports in order to have our common stock quoted on the OTC Bulletin Board, we do not intend to suspend our reporting obligations in the foreseeable future.

 

The public may read and copy any materials that we file with the Commission at the Commission's Public Reference Room at 100 F St,, NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Commission maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the Commission. The address of that site is http://www.sec.gov.

 

We intend to furnish to our stockholders annual reports containing financial statements audited and reported upon by our independent accounting firm, and such other periodic reports as we may determine to be appropriate or as may be required by law.

          

24


 

 

I.

 

 

AUDITED FINANCIAL STATEMENTS AND SCHEDULES

September 30, 2013

AUTOVATIVE TECHNOLOGIES, INC

 

Index to Financial Statements

 

      Page  
Report of Independent Registered Public Accounting Firm     F-2- F-3  
Balance Sheet     F-4  
Statement of Operations     F-5  
Statement of Stockholders' Equity     F-6  
Statement of Cash Flows     F-7  
Notes to Financial Statements     F8-F11  

 

F-1

 

 

 

 

 
 

 

 

 

 

 AUDITORS LETTER

F-2

  

 

AUTOVATIVE TECHNOLOGIES, INC

CONSOLIDATED BALANCE SHEET

September 30, 2013

     
    September 30,
    2013
         
Assets        
         
Current Assets        
 Cash   $ 81,362  
 Accounts receivable     315  
Prepaid advertising     8,000  
Total Current Assets     89,677  
         
Total Assets   $ 89,677  
         
Liabilities And Stockholders' Equity        
         
Current Liabilities        
    Accounts payable   $ 46,906  
Total Current Liabilities     46,906  
         
Total Liabilities     46,906  
         
Stockholders' Equity (Deficit)        
         
Common stock $0.001 par value 75,000,000 shares authorized
6,789,298 shares issued and outstanding
    6,789  
at September 30, 2013        
Additional paid in capital     42,310  
Accumulated deficit     (6,328 )
Total Stockholders' Equity     42,771  
         
Total Liabilities and        
Stockholders' Equity   $ 89,677  
         
         
         
         

See accompanying notes to consolidated financial statements.

F-3

 

 

 

 

 
 

 

 

 

 

AUTOVATIVE TECHNOLOGIES, INC

CONSOLIDATED STATEMENT OF OPERATIONS

For the Period December 10, 2012 (date of inception)

Through September 30, 2013

 

 

   
Revenue      
       
Sales $ 62,673  
Cost of goods sold   47,696  
Gross Profit   14,977  
       
General and Administrative Expenses      
 Professional fees   25,131  
 Commissions   8,485  
 Office expenses   2,689  
       
Total Expenses   36,305  
       
Net Operating Loss   (21,328 )
       
Other Income   15,000  
       
Net Loss $ (6,328 )
       
Basic and Diluted Loss Per Common Share $ (0.00 )
       
Weighted Average Shares Outstanding   2,195,166  
       
       
       

 

See accompanying notes to consolidated financial statements.

F-4

 

 

 

 

 

 
 

 

 

 

 

AUTOVATIVE TECHNOLOGIES, INC

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)

September 30, 2013

 

      Common Stock                    
      Number of                Additional        Accumulated          
      Shares       Amount        Paid in Capital        Deficit        Total  
                                         
August 14, 2013 Stock dividend from Autovative                                        
 Products, Inc.     855,798       856       7,702     $ —       $ 8,558  
Difference of assets and liabilities in spin-off of operations     —         —         (15,059 )     —         (15,059 )
Contribution of capital by officer for payables     —         —         16,650               16,650  
Sale of stock for cash, related party     600,000       600       —                 600  
Stock issued for services, related party     5,000,000       5,000       —                 5,000  
Sale of stock for cash     250,000       250       24,750               25,000  
Stock issued for services     83,500       83       8,267               8,350  
                                         
Net loss for the year ended September 30, 2013                             (6,328 )     (6,328 )
                                         
Balance, December 31, 2012     6,789,298       6,789       42,310     $ (6,328 )   $ (42,771 )
                                         
                                         

See accompanying notes to consolidated financial statements.

F-5

 

 

 

 

 

 
 

 

 

 

 

 

 AUTOVATIVE TECHNOLOGIES, INC

CONSOLIDATED STATEMENT OF CASH FLOWS

For the Period December 10, 2012 (date of inception)

through September 30, 2013

 

 

   
Cash Flows from Operating Activities      
Net loss $ (6,328 )
Issuance of shares for services   5,350  
       
Adjustments to Reconcile Net Loss To Net Cash
Provided by Operating Activities:
     
       
 Accounts receivable   13,569  
 Accounts payable   24,474  
       
Net Cash Provided by Operating Activities   37,338  
       
Cash Flows From Investing Activities   —    
       
Cash Flows from Financing Activities      
Cash from transfer of operations by parent company   1,774  
Sale of common stock   25,600  
Contribution of capital by officer   16,650  
Net Cash Provided by Financing Activities   44,024  
       
Increase in Cash   81,362  
       
Cash at Beginning of Year   —    
       
Cash at End of Year $ 81,362  
       
Supplemental cash flow information and noncash financing activities:      
       
Cash paid for Interest $ —    
       
Cash paid for income taxes $ —    
       
Shares issued for prepaid advertising $ 8,000  

 

See accompanying notes to consolidated financial statements.

 

F-6

 

 

 

 

 

 
 

 

 

 

 

AUTOVATIVE TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2013

 

 

NOTE A - SUMMARY OF ACCOUNTING POLICIES

 

A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows.

 

BUSINESS AND BASIS OF PRESENTATION

 

Autovative Technologies, Inc. ("ATI") was incorporated under the laws of the State of Nevada on December 10, 2012. Autovative Technologies was a wholly owned subsidiary of Autovative Products, Inc. ("API"), a publicly traded Nevada corporation. On December 31, 2012, the Company created a wholly owned subsidiary, Autovative Products, Inc., in the State of Montana. The Company has elected a year end of September 30. The prior operations under API had a year end of December 31.

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk constituted all of the issued and outstanding shares of API's subsidiary, Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata basis, based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

ATI was formed to develop businesses, assets and opportunities, some acquired and contributed from third parties and our founding shareholders, in the trucking/automobile special parts production and distribution industry and some related fields. ATI is a Specialty distribution Company of Fleet truck products. Currently the Company has exclusive distribution rights with both FedEx (Federal Express) and UPS (United Parcel Service) for its Portable Tow Truck Units.

 

GOING CONCERN

 

The Company incurred losses its initial period of operations.  There is no assurance that we will attain profitability in the future.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern that contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. However, the ability of the Company to continue as a going concern on a longer-term basis will be dependent upon the ability to consistently generate sufficient cash flow from operations to meet its obligations on a timely basis, and the ability to successfully raise additional financing to implement its business strategy.

 

As shown in the accompanying financial statements, the Company incurred a net loss of $ (6,328) for the period ended September 30, 2013. As of September 30, 2013 the Company's current assets were $89,677 and the total assets were $89,677 and its liabilities were $46,906. The Company's assets exceeded its liabilities by $42,771.

 

ESTIMATES

 

The preparation of the financial statement in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts. Accordingly, actual results could differ from those estimates.

 

REVENUE RECOGNITION

 

We recognize revenue from product sales or services rendered when the following four criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured. Revenues from design services provided are recorded upon billing of completed services.

We evaluate whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions as determined by Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 605-45-45, Overall Considerations of Reporting Revenue Gross as a Principal Versus Net as an Agent. We are primarily obligated in the transaction, subject to credit risk, have latitude in establishing prices and selecting suppliers, and risk of replacing lost shipments, therefore revenue is recorded at the gross sales price.

Product sales represent revenue from the sale of products and related shipping fees where we are the seller of record. Product sales and shipping revenues are recorded when the products are shipped and title passes to customers.

 

CONCENTRATIONS

 

Customers:

During 2013 two customers accounted for 100% of our revenue and one customer accounted for 98.7% of sales. The loss of these customers could have a material adverse effect on our financial position and results of operations.

 

At September 30, 2013, two customers accounted for a total of 100% of our accounts receivable.

 

CASH EQUIVALENTS

 

The Company considers cash on hand, deposits in banks, and short-term investments purchased with an original maturity date of three months or less to be cash and cash equivalents. The carrying amounts reflected in the balance sheets for cash and cash equivalents approximate the fair values due to short maturities of these instruments. As of September 30, 2013 the Company did not have any cash equivalents.

 

F-7

 

INCOME TAXES

 

We account for income taxes in accordance with FASB ASC 740, Income Taxes which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

 

FAIR VALUE OF FINANCIAL INSTRUMENTS

 

FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosure about fair value measurements. FASB ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1. Observable inputs such as quoted prices in active markets;

Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions.

The Company does not have any assets or liabilities measured at fair market value on a recurring basis at September 30, 2013. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the period ended September 30, 2013.

 

SHARE BASED EXPENSES

 

FASB ASC 718, Compensation - Stock Compensation prescribes accounting and reporting standards for all stock-based payments award to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50, Equity - Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

 

EARNINGS PER SHARE

 

Earnings per share is calculated in accordance with the FASB ASC Topic 260, Earnings Per Share specifying the computation, presentation and disclosure requirements of earnings per share information. Basic earnings per share have been calculated based upon the weighted average number of common shares outstanding. Stock options and warrants have been excluded as common stock equivalents in the diluted earnings per share because they are either anti-dilutive, or their effect is not material. There are no shares with a dilutive impact at September 30, 2013.

 

CONCENTRATIONS OF CREDIT RISK

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and trade receivables. The Company places its cash and temporary cash investments with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit.

The Company currently has two customers that constitute all sales. The largest customer accounted for $61,858 (98.7%) of the total sales. The Company periodically reviews its trade receivables in determining its allowance for doubtful accounts. The allowance for doubtful accounts was $0 as of September 30, 2013.

ADVERTISING

 

The Company follows a policy of charging the costs of advertising to expenses incurred. The Company incurred prepaid advertising costs totaling $8,000 during the year ended September 30, 2013.

 

F-8

 

NEW ACCOUNTING PRONOUNCEMENTS

 

In February 2013, the FASB issued new guidance requiring additional information about reclassification adjustments out of comprehensive income, including changes in comprehensive income balances by component and significant items reclassified out of comprehensive income. This new standard is effective for our fiscal year ending December 31, 2013 and will have no impact on our financial condition or results of operations.

 

We believe that no other new accounting guidance was adopted or issued during 2013 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

 

NOTE B - INCOME TAXES

 

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating loss carryovers since inception. When it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carryforwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period.

 

The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the year ended September 30, 2013. The Company has not filed its tax return as of September 30, 2013.

 

The components of the Company's deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of September 30, 2013 is as follows:

 

      September 30, 2013  
         
Net operating loss carry forward   $ 6,328  
Effective Tax rate     35 %
Deferred Tax Assets     2,215  
Less: Valuation Allowance     (2,215 )
Net deferred tax asset   $ —    

 

The net federal operating loss carry forward will expire between 2033. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.

 

 

F-9

 

NOTE C - CAPITAL STOCK

 

PREFERRED STOCK

 

The Company currently has not authorized any class of Preferred stock.

 

COMMON STOCK

 

The Company is authorized to issue 75,000,000 shares of common stock, par value $0.001 per share. The company has 6,789,298 shares issued at the year ended September 30, 2013.

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, Inc. At that time the shares acquired by David Funderburk constituted all of the issued and outstanding shares of API's subsidiary, Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata basis, based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

Through year end September 30, 2013 the Company issued 5,000,000 shares of restricted 144 stock for services rendered to the Company through year ended September 30, 2013, to its President and issued 600,000 shares of stock for $600.

 

On August 15, 2013 the Company issued 80,000 shares of restricted 144 common stock per a contract with Blue Sky Media Corporation (advertising services valued at $8,000 or $0.10 per share).

 

On September 23, 2013 the Company issued 250,000 shares of restricted 144 common stock to Janice Douglas for $0.10 per share for a total of $25,000. On September 25, 2013 the Company issued 3,500 shares to Steve Lynch for consulting\marketing services valued at $0.10 per share.

 

NOTE D - COMMITMENTS AND CONTINGENCIES

 

PURCHASE AGREEMENTS

 

On January 11, 2013 the Company's subsidiary, Autovative Products, Inc. (newly formed subsidiary on December 31, 2012 in the State of Montana) entered into a Marketing/Sales Contract with OTW Enterprises LLC. OTW Enterprises LLC is the manufacturer of the Portable Tow Truck and the Overhead Door Saver. The contract entitles the Company to exclusive marketing rights as a reseller within the USA and Europe for the Portable Tow Truck and the Overhead Door Saver.

 

F-10

 

 

NOTE E - RELATED PARTY TRANSACTIONS

 

The Company neither owns nor leases any real or personal property. An officer of the corporation provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.

 

Through the year end September 30, 2013, 5,000,000 shares, were issued to David Funderburk valued at a par value of $.001 for funds advanced by David Fundrburk for the initial corporate formation and bank account.  The Company used that basis in share value for further issuances until the Company was independent of its Predecessor, Autovative Products, Inc. Once the Company was independent of Autovative Products, Inc., services for share issuances were determined to be more valuable.

 

The Company issued 600,000 shares of restricted stock for $600 to its President.

 

The officer of the Company received no commissions for the year ended September 30, 2013.

 

The officer of the Company received wages of $2,500 for the year ended September 30, 2013.

 

 

F-11


 

 

 

 

 
 

 

 

 

 

 

AUDITED FINANCIAL STATEMENTS AND SCHEDULES

December 31, 2012 and December 31, 2011

AUTOVATIVE PRODUCTS, INC

(Predecessor)

 

Index to Financial Statements

 

  Page
Report of Independent Registered Public Accounting Firm F-13
Balance Sheets F-14
Statements of Operations F-15
Statement of Stockholders' Equity F-16
Statements of Cash Flows F-17
Notes to Financial Statements F18-F21

 

F-12

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

 

To the Board of Directors and Stockholders

Autovative Products, Inc.

 

 

We have audited the accompanying balance sheets of Autovative Products, Inc. as of December 31, 2012 and 2011 and the related statements of operations, stockholders' equity, and cash flows for the years then ended. 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 audit.

 

We conducted our audit 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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. 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 audit 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 Autovative Products, Inc. as of December 31, 2012 and 2011 and the results of its operations and cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.

 

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 limited operations and has limited established sources of revenue. This raises substantial doubt about its ability to continue as a going concern. Management's plan in regard to these matters is also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

 

 /S/ Kyle L. Tingle

Kyle L. Tingle, CPA, LLC

 

 

March 29, 2013

Las Vegas, Nevada 

 

 

   

 

F-13

 

AUTOVATIVE PRODUCTS, INC

BALANCE SHEETS

December 31, 2012 and 2011

 

         
         
    2012   2011
              (restated)   
Assets                
                 
Current Assets                
 Cash   $ 1,774     $ 28,343  
 Accounts receivable     13,883       17,875  
Total Current Assets     15,657       46,218  
                 
                 
Total Assets   $ 15,657     $ 46,218  
                 
Liabilities And Stockholders' Equity                
                 
Current Liabilities                
    Accounts payable   $ 22,159     $ 18,744  
    Accrued interest and penalties     14,049       13,124  
    Accrued income tax payable     13,357       13,357  
Total Current Liabilities     49,565       45,225  
                 
Total Liabilities     49,565       45,225  
                 
Stockholders' Equity                
                 
Common stock $0.001 par value75,000,000 shares authorized 8,557,977 shares issued and outstanding     8,558       8,586  
 At December 31, 2012 and 8,585,977 shares issued
and outstanding at December 31, 2011
               
Additional paid in capital     24,583       24,555  
(Accumulated deficit) retained earnings     (67,048 )     (32,148 )
Total Stockholders' Equity     (33,907 )     993  
                 
Total Liabilities And                
Stockholders' Equity   $ 15,657     $ 46,218  
                 
                 

See accompanying notes to financial statements.

F-14

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 AUTOVATIVE PRODUCTS, INC

STATEMENTS OF OPERATIONS

For the Years Ended December 31, 2012 and 2011

 

    2012   2011
Revenue                          (restated)  
                 
Sales   $ 53,300     $ 63,253  
Services     21,000       57,100  
Total Revenue     74,300       120,690  
Cost of goods sold     40,368       46,544  
Gross Profit     33,932       74,146  
                 
General and Administrative Expenses                
 Advertising and marketing     17,500       23,700  
 Commissions     12,932       19,266  
 Depreciation and amortization     —         8,288  
 Professional fees     34,927       7,995  
 Office expenses     2,548       672  
                 
Total Expenses     67,907       59,921  
                 
Net Operating Income (Loss)     (33,975 )     14,225  
                 
Other Expense
Interest expense
    925       886  
Impairment of intangible asset     —         43,214  
Loss of disposal of assets     —         5,000  
Total Other Expense     925       49,100  
                 
Net Loss   $ (34,900 )   $ (34,874 )
                 
Basic and Diluted Loss Per Common Share   $ (0.00 )   $ (0.00 )
                 
Weighted Average Shares Outstanding     8,584,523       8,585,977  
                 

 

See accompanying notes to financial statements.

F-15

 

 

 

 

 

 

 
 

 

 

 

 

 

AUTOVATIVE PRODUCTS, INC

STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)

For the Years Ended December 31, 2012 and 2011

 

      Common Stock Number of Shares     Amount      Additional Paid in Capital      Accumulated Deficit      Total  
                                 
Balance, December 31, 2010     8,585,977   $ 8,586   $ 24,555   $ 2,726   $ 35,867  
                                 
Net loss for the year ended December 31, 2011     —       —       —       (34,874 )   (34,874 )
                                 
Balance, December 31, 2011     8,585,977   $ 8,586   $ 24,555   $ (32,148 ) $ 993  
                                 
Net loss for the year ended December 31, 2012     —       —       —       (34,900 )   (34,900 )
 
Rescission of shares
    (28,000 )   (28 )   28     —       —    
                                 
Balance, December 31, 2012     8,557,977   $ 8,557   $ 24,583   $ (64,048 ) $ (26,425 )

See accompanying notes to financial statements.

F-16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

AUTOVATIVE PRODUCTS, INC

STATEMENTS OF CASH FLOWS

For the Years Ended December 31, 2012 and 2011

 

  2012   2011
Cash Flows from Operating Activities           (Restated)  
Net Loss $ (34,900 )   $ (34,874 )
   Depreciation and amortization   —         8,288  
   Impairment of intellectual property   —         43,214  
   Loss on disposal of assets   —         5,000  
Adjustments to Reconcile Net Loss To Net Cash
Provided by (Used In) Operating Activities:
             
               
 Accounts receivable   3,991       13,250  
 Accounts payable   3,414       (8,466 )
 Accrued interest and penalties   925       886  
               
Net Cash Provided by (Used In) Operating Activities   (26,570 )     27,298  
               
Cash Flows From Investing Activities           —    
               
Cash Flows from Financing Activities              
Net Cash Provided by Financing Activities   —         —    
               
Increase (Decrease) in Cash   (26,570 )     27,298  
               
Cash at Beginning of Year   28,343       1,045  
               
Cash at End of Year $ 1,774     $ 28,343  
               
Cash paid for Interest $ —       $ —    
               
Cash paid for income taxes $ —       $ —    

 

See accompanying notes to financial statements.

 

F-17

 

AUTOVATIVE PRODUCTS INC.

NOTES TO THE FINANCIAL STATEMENTS

For the Years Ended December 31, 2012 and 2011

 

 

 

NOTE 1 - SUMMARY OF ACCOUNTING POLICIES

 

A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows.

 

BUSINESS AND BASIS OF PRESENTATION

 

Autovative Products Inc. ("Company" or "Autovative Products") was formed on December 8, 2004 under the laws of the State of Nevada.

 

Autovative Products is a Specialty distribution company of fleet truck products. Currently the Company has exclusive distribution rights with both Federal Express (FEDEX) and United Postal Service (UPS) for its Portable Tow Truck. The Company is currently in the process of marketing its Overhead Door Saver to both FEDEX and UPS.

 

The Company also provides specialty product designs on a contract basis.

 

ESTIMATES

 

The preparation of the financial statement in conformity with generally accepted accounting principles requires 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. Accordingly, actual results could differ from those estimates.

 

REVENUE RECOGNITION

 

We recognize revenue from product sales or services rendered when the following four criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured. Revenues from design services provided are recorded upon billing of completed services.

 

We evaluate whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions as determined by Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 605-45-45, Overall Considerations of Reporting Revenue Gross as a Principal Versus Net as an Agent. We are primarily obligated in the transaction, subject to credit risk, have latitude in establishing prices and selecting suppliers, and risk of replacing lost shipments, therefore revenue is recorded at the gross sales price.

 

Product sales represent revenue from the sale of products and related shipping fees where we are the seller of record. Product sales and shipping revenues are recorded when the products are shipped and title passes to customers.

 

CONCENTRATIONS

 

Customers:

During 2012 and 2011, three, respectively, accounted for 100% and 100%, respectively, of our revenue. In 2012, $48,692 was from UPS and $4,608 from Johnson Industries and $21,000 in Service revenue from wholesale 4 You, Inc.. In 2011, $56,632 was from UPS and $6,621 from Johnson Industries and $57,100 in Service revenue from wholesale 4 You, Inc.. The loss of these customers could have a material adverse effect on our financial position and results of operations.

 

At December 31, 2012 and 2011, two customers, UPS and Johnson Industries accounted for a total of 100% of our accounts receivable.

 

INCOME TAXES

 

We account for income taxes in accordance with FASB ASC 740, Income Taxes which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

 

PROPERTY AND EQUIPMENT

 

Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using straight-line methods over the estimated useful lives of the assets, principally three to five years, or the term of the lease, if shorter, for leasehold improvements.

 

IMPAIRMENT OF LONG-LIVED ASSETS

 

In September 2011, the FASB issued ASU 2011-08 Goodwill and Other (Topic 350) which amends the guidance on testing goodwill for impairment. Under the revised guidance, entities testing goodwill for impairment have the option of performing a qualitative assessment before calculating the fair value of the reporting unit (i.e., step 1 of the goodwill impairment test). If entities determine, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not less than the carrying amount, the two-step impairment test would be required. The ASU does not change how goodwill is calculated or assigned to reporting units, nor does it revise the requirement to test goodwill annually for impairment. In addition, the ASU does not amend the requirement to test goodwill for impairment between annual tests if events or circumstances warrant; however, it does revise the examples of events and circumstances that an entity should consider. The guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The Statement requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. The Company uses an estimate of undiscounted future net cash flows of the assets over the remaining useful lives in determining whether the carrying value of the assets is recoverable. If the carrying values of the assets exceed the expected future cash flows of the assets, the Company recognizes an impairment loss equal to the difference between the carrying values of the assets and their estimated fair values. Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash flows that are independent from other groups of assets. The evaluation of long-lived assets requires the Company to use estimates of future cash flows. However, actual cash flows may differ from the estimated future cash flows used in these impairment tests.

 

The company performed such an impairment review and determined that the future benefits from long-lived assets no longer exceed their carrying and a write down of the carrying value was necessary.

 

F-18

 

 

FAIR VALUE OF FINANCIAL INSTRUMENTS

 

FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosure about fair value measurements. FASB ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

 

Level 1. Observable inputs such as quoted prices in active markets;

 

Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions.

 

The Company does not have any assets or liabilities measured at fair market value on a recurring basis at December 31, 2012 or 2011. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the periods ended December 31, 2012 or 2011.

 

SHARE BASED EXPENSES

 

FASB ASC 718 "Compensation - Stock Compensation" prescribes accounting and reporting standards for all stock-based payments award to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50 "Equity - Based Payments to Non-Employees." Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

 

EARNINGS PER SHARE

 

Earnings per share is calculated in accordance with the FASB ASC Topic 260, "Earnings Per Share" specifying the computation, presentation and disclosure requirements of earnings per share information. Basic earnings per share have been calculated based upon the weighted average number of common shares outstanding. Stock options and warrants have been excluded as common stock equivalents in the diluted earnings per share because they are either anti-dilutive, or their effect is not material. There are no shares with a dilutive impact at December 31, 2012 and 2011.

 

CONCENTRATIONS OF CREDIT RISK

 

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and trade receivables. The Company places its cash and temporary cash investments with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit.

 

ADVERTISING

 

The Company follows a policy of charging the costs of advertising to expenses incurred. The Company incurred advertising expenses totaling $17,500 for the year ended December 31, 2012 and $23,700 for the year ended December 31, 2011.

 

NEW ACCOUNTING PRONOUNCEMENTS

 

In June 2012, the Financial Accounting Standards Board ("FASB") issued guidance on the presentation of comprehensive income. The new guidance requires companies to report components of comprehensive income by including comprehensive income on the face of the income statement or in a separate statement of comprehensive income. The new standard has no effective on our reporting at this time.

In February 2013, the FASB issued new guidance requiring additional information about reclassification adjustments out of comprehensive income, including changes in comprehensive income balances by component and significant items reclassified out of comprehensive income. This new standard is effective for our fiscal year ending May 31, 2014 and will have no impact on our financial condition or results of operations.

We believe that no other new accounting guidance was adopted or issued during 2012 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

 

F-19

 

 

GOING CONCERN

 

The Company has had losses since its initial year of operations.  There is no assurance that we will attain profitability in the future.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern that contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. However, the ability of the Company to continue as a going concern on a longer-term basis will be dependent upon the ability to consistently generate sufficient cash flow from operations to meet its obligations on a timely basis, and the ability to successfully raise additional financing to implement its business strategy.

 

NOTE 2 – FIXED ASSETS---

 

The company abandoned or disposed of the furniture and computer assets as of December 31, 2011 recognizing a loss on abandonment of $9,000.

 

The Company's intellectual property consisted of the industrial design for an Auto traction mold and Auto traction mat design which was acquired in 2005. The Company reclassified equipment as intellectual property at year end 2011 and after impairment analysis and amortization, considers it fully impaired recognizing impairment of $43,214 in 2011.

 

NOTE 3 - CAPITAL STOCK

 

The Company is authorized to issue 25,000,000 shares of common stock, par value 0.001 per share. The company has 8,557,977 shares issued at December 31, 2012 and 8,585,977 in 2011.

 

On December 29, 2010 the Company issued 25,000 shares of restricted 144 common stock per a contract with Direct Media Enterprises which were distributed to the shareholders of Direct Media Enterprises for media advertising via Direct Media Enterprise's kiosk technology. The stock was issued for initial video production services at a price of $0.10 per share (services valued at $2,500).

 

On December 13, 2012, the Company rescinded the 25,000 shares for Direct Media Enterprise's kiosk technology, as the project was not completed. An additional 3,000 shares were rescinded from the finder's fee for Direct Media Enterprises.

 

NOTE 4: PRIOR PERIOD ADJUSTMENTS AND RESTATEMENT OF REPORTED NET INCOME

 

The previously issued financial statements for 2011 have been restated for the following departures from generally accepted accounting principles:

a.       Accounts receivable for sales invoiced prior to December 31, 2011 and collected in 2012;

b.      Accounts payable and commissions for product shipped prior to December 31, 2011;

 

The cumulative effect of the corrections are as follows:

 

 December 31, 2011   As Previously Stated   As Restated
Accounts Receivable:     14,537     $ 17,875  
Total Current Assets     42,880       46,218  
Total Assets:     42,880       46,218  
Accounts Payable     7,923       18,744  
Total Current Liabilities     34,404       45,225  
Accumulated deficit:     (24,665 )     (32,148 )
Total Liabilities and
Retained Earnings:
    42,880       46,218  
                 
Sales:     117,353       120,690  
Cost of Sales     40,064       46,544  
Gross Profit     77,289       74,146  
General and Administrative Expenses     56,466       60,807  
Net Loss     (27,391 )     (34,874 )
                 
Net Loss Per Share   $ (0.00 )     (0.00 )

 

 F-20

 

NOTE 5 - INCOME TAXES

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating loss carryovers since our second year of operations. When it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit.  We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carryforwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carryforward period.

The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the twelve-months ended December 31, 2012 and 2011, or during the prior three years applicable under FASB ASC 740. We did not recognize any adjustment to the liability for uncertain tax position and therefore did not record any adjustment to the beginning balance of accumulated deficit on the balance sheet. All tax returns have been appropriately filed by the Company.

 

Income tax provision at the federal statutory rate   35%
Effect on operating losses   (35%)
    -

 

Net deferred tax assets consist of the following:

 

  2012   2011
Net operating loss carry forward $ 154,817    $ 121,167   
Permanent differences   (7,594)     (6,344)  
    147,223      114,283   
Tax at statutory rate (35%)   51,966      40,188   
Valuation allowance   (51,966)     (40,188)  
Net deferred tax asset $ -   $ -  
             

 

A reconciliation of income taxes computed at the statutory rate is as follows:

 

  2012   2011
Tax at statutory rate (35%) $ 11,778    $ 12,206   
Increase in valuation allowance   (11,778)     (12,206)  
Net deferred tax asset $ -   $ -  
             

 

The Company did not pay any income taxes during the years ended December 31, 2012 or 2011.

 

The net federal operating loss carry forward will expire from 2026 through 2032.  This carry forward may be limited upon the consummation of a business combination under IRC Section 381.

 

 

NOTE 6 – RELATED PARTY TRANSACTIONS

 

The Company neither owns nor leases any real or personal property.  An officer of the corporation provides office services without charge.  Such costs are immaterial to the financial statements and accordingly, have not been reflected therein.  The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities.  If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest.  The Company has not formulated a policy for the resolution of such conflicts. 

 

The officer of the Company received commissions of $6,222 and $9,715 for the years ended December 31, 2012 and 2011, respectively.

 

NOTE 7 – SUBSEQUENT EVENTS

 

On December 31, 2012, the majority shareholder and officer of the Company entered into a Securities Purchase Agreement to sell 7,080,555 shares of the Company. This will occur in early 2013 and will effect a change in control of the Company.

 

F-21

 

AUTOVATIVE TECHNOLOGIES, INC

FINANCIAL STATEMENTS

December 31, 2013

(Unaudited)

and September 30, 2013

 

Index to Financial Statements

 

  Page
Balance Sheets F-22
Statements of Operations F-23
Statements of Cash Flows F-24
Notes to Financial Statements F25-F28

 

 

 

 

 

AUTOVATIVE TECHNOLOGIES, INC

CONDENSED BALANCE SHEETS

 

     

December 31, 2013

(Unaudited)

 

    September 30, 2013  
Assets              
               
Current Assets              
  Cash    $ 40,080   $ 81,362  
  Accounts receivable     26,780     315  
Other Current Asset              
  Prepaid advertising     8,000     8,000   
Total Current Assets     74,861     89,677  
               
               
Total Assets    $ 74,861   $ 89,677  
               
Liabilities And Stockholders’ Equity              
               
Current Liabilities              
  Accounts payable    $ 24,420   $ 46,906  
Total Current Liabilities     24,420     46,906  
               
Total Liabilities     24,420     46,906  
               
Stockholders’ Equity              
               
Common Stock $0.001 Par Value 75,000,000 Shares Authorized 6,789,298 shares issued and outstanding     6,789     6,789  
               
Paid in capital     42,310     42,310  
Retained earnings     1,341     (6,328 )
Total Stockholders’ Equity     50,440     42,771  
               
Total Liabilities And              
Stockholders’ Equity   74,861   $ 89,677  
               
               

See accompanying notes to condensed financial statements.

F-22

 

 

AUTOVATIVE TECHNOLOGIES, INC

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months Ended December 31, 2013

And

For Autovative Products, Inc. (Predecessor)

For the Three Months Ended December 31, 2012

(Unaudited)

 

  Three Months Ended December 31, 2013    

Autovative Products, Inc. (Predecessor)

For the Three Months Ended December 31, 2012

 

 

 
Revenue          
           
Sales $                          28,556   $ 45,643  
Total Revenue 28,556     45,643  
           
Cost of goods sold 21,248     30,752  
Gross Profit 7,308     14,891  
           
General and administrative expenses          
           
  Commissions 3,136     9,891  
  Advertising and marketing —       8,500  
  General & administrative 7,503     20  
  Professional fees 4,000     10,614  
           
Total Expenses 14,639     29,025  
           
Net Operating Loss (7,331 )   (14,134)  
           
Other Income          
  Sales-Territory 15,000     —    
           
Total Other Income 15,000        
           
Interest Expense —       236  
           
Net Income (Loss) $                              7,669   $ (14,370)  
           
Basic and Diluted Net Income (Loss)  Per Share $                                0.00   $ (0.00)  
           
Weighted Average Shares Outstanding 6,789,298     8,585,977  
           
           

 

See accompanying notes to condensed

financial statements.

F-23

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

 

AUTOVATIVE TECHNOLOGIES, INC

CONDENSED STATEMENTS OF CASH FLOWS

For the Three Months Ended December 31, 2013

And

For Autovative Products, Inc. (Predecessor)

For the Three Months Ended December 31, 2012

(Unaudited)

 

 

  For the Three
Months Ended
December 31, 2013
Autovative Products, Inc (Predecessor)
For the Three Months
Ended December 31, 2013
Cash Flows from Operating Activities            
Net Income (Loss) $ 7,669   $ (14,370 )
             
Adjustments to Reconcile Net Income (Loss) To Net Cash (Used In) Operating Activities:            
             
  Amortization of Long Lived Asset   —       —    
  Accounts Payable   (22,486 )   13,732  
  Changes In Accounts Receivable   (26,465 )   (7,733 )
  Accrued Tax Expense   —       —    
  Accrued Interest and Penalties   —       236  
             
Net Cash (Used In) Operating Activities   (41,282 )   (8,135 )
             
Cash Flows From Investing Activities            
             
Net Cash Provided by (Used In) Investing Activities   —       —    
             
Cash Flows from Financing Activities            
  Capital Stock         (28 )
  Additional Paid In Capital         28  
             
Net Cash Provided by (Used In) Financing Activities         —    
             
Decrease in Cash   (41,282 )   (8,135 )
             
Cash at Beginning of the Quarter   81,362     9,909  
             
Cash at End of Quarter $ 40,080   $ 1,774  

 

*For the Quarters at December 31, 2013 and 2012, there were no payments for interest or taxes.

 

See accompanying notes to condensed

financial statements.

 

F-24

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

AUTOVATIVE TECHNOLOGIES, INC

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

For the Three Months Ended December 31, 2013

(Unaudited)

 

 

NOTE A - SUMMARY OF ACCOUNTING POLICIES

 

A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows.

 

BUSINESS AND BASIS OF PRESENTATION

 

Autovative Technologies, Inc. ("ATI") was incorporated under the laws of the State of Nevada on December 10, 2012. Autovative Technologies was a wholly owned subsidiary of Autovative Products, Inc. ("API", "Predecessor"), a publicly traded Nevada corporation. On December 31, 2012, the Company created a wholly owned subsidiary, Autovative Products, Inc., in the State of Montana. The Company has elected a year end of September 30. The prior operations under API had a year end of December 31.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, inc. At that time the shares acquired by David Funderburk were the only shares issued from Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

ATI was formed to develop businesses, assets and opportunities, some acquired and contributed from third parties and our founding shareholders, in the trucking/automobile special parts production and distribution industry and some related fields. ATI is a Specialty distribution Company of Fleet truck products. Currently the Company has exclusive distribution rights with both FedEx (Federal Express) and UPS (United Parcel Service) for its Portable Tow Truck Units.

 

GOING CONCERN

 

The Company incurred operating losses its initial periods of operations.  There is no assurance that we will attain profitability in the future.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern that contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. However, the ability of the Company to continue as a going concern on a longer-term basis will be dependent upon the ability to consistently generate sufficient cash flow from operations to meet its obligations on a timely basis, and the ability to successfully raise additional financing to implement its business strategy.

 

As shown in the accompanying financial statements, the Company had a net income of $7,669 for the period ended December 31, 2013, while it's predecessor incurred a net loss of $14,370 for the period ending December 31, 2012. As of December 31, 2013 the Company's current assets were $74,861 and the total assets were $74,861 and its liabilities were $24,420 as compared to the current assets of $89,677 and total assets of $89,677 and liabilities of $46,906 as of September 30, 2013.

 

ESTIMATES

 

The preparation of the financial statement in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts. Accordingly, actual results could differ from those estimates.

 

REVENUE RECOGNITION

 

We recognize revenue from product sales or services rendered when the following four criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured. Revenues from design services provided are recorded upon billing of completed services.

We evaluate whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions as determined by Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 605-45-45, Overall Considerations of Reporting Revenue Gross as a Principal Versus Net as an Agent. We are primarily obligated in the transaction, subject to credit risk, have latitude in establishing prices and selecting suppliers, and risk of replacing lost shipments, therefore revenue is recorded at the gross sales price.

Product sales represent revenue from the sale of products and related shipping fees where we are the seller of record. Product sales and shipping revenues are recorded when the products are shipped and title passes to customers.

 

CASH EQUIVALENTS

 

The Company considers cash on hand, deposits in banks, and short-term investments purchased with an original maturity date of three months or less to be cash and cash equivalents. The carrying amounts reflected in the balance sheets for cash and cash equivalents approximate the fair values due to short maturities of these instruments. As of December 31, 2013 the Company did not have any cash equivalents.

 

INCOME TAXES

 

We account for income taxes in accordance with FASB ASC 740, Income Taxes which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

 

F-25

 

 

FAIR VALUE OF FINANCIAL INSTRUMENTS

 

FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosure about fair value measurements. FASB ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1. Observable inputs such as quoted prices in active markets;

Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions.

The Company does not have any assets or liabilities measured at fair market value on a recurring basis at December 31, 2013. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the period ended December 31, 2013.

 

SHARE BASED EXPENSES

 

FASB ASC 718, Compensation - Stock Compensation prescribes accounting and reporting standards for all stock-based payments award to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50, Equity - Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

 

EARNINGS PER SHARE

 

Earnings per share is calculated in accordance with the FASB ASC Topic 260, Earnings Per Share specifying the computation, presentation and disclosure requirements of earnings per share information. Basic earnings per share have been calculated based upon the weighted average number of common shares outstanding. Stock options and warrants have been excluded as common stock equivalents in the diluted earnings per share because they are either anti-dilutive, or their effect is not material. There are no shares with a dilutive impact at December 31, 2013.

 

CONCENTRATIONS OF CREDIT RISK

 

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and trade receivables. The Company places its cash and temporary cash investments with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit.

 

The Company currently has two customers that constitute all sales. Customer A accounted for 82.1% of the total sales and customer B accounted for 17.9% of the total sales for the three month period ending December 31, 2013.

 

As of December 31, 2013, customer A accounted for 87.55% of accounts receivable and customer B accounted for 12.45% of accounts receivable. The Company periodically reviews its trade receivables in determining its allowance for doubtful accounts. The allowance for doubtful accounts was $0 as of December 31, 2013.

 

ADVERTISING

 

The Company follows a policy of charging the costs of advertising to expenses incurred. The Company incurred prepaid advertising costs totaling $8,000 during the year ended September 30, 2013 and remains as a prepaid advertising cost of $8,000 at the three months ended December 31, 2013 as no work on the kiosks had begun.

 

NEW ACCOUNTING PRONOUNCEMENTS

 

In February 2013, the FASB issued new guidance requiring additional information about reclassification adjustments out of comprehensive income, including changes in comprehensive income balances by component and significant items reclassified out of comprehensive income. This new standard is effective for our fiscal year ending September 30, 2013 and will have no impact on our financial condition or results of operations.

 

We believe that no other new accounting guidance was adopted or issued during 2013 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

 

F-26

 

 

NOTE B - INCOME TAXES

 

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating loss carryovers since inception. When it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carryforwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period.

 

The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the three months ended December 31, 2013. The Company has not filed its tax return as of December 31, 2013.

 

The components of the Company's deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of September 30, 2013 is as follows:

 

      September 30, 2013  
         
Net operating loss carry forward   $ 6,328  
Effective Tax rate     35 %
Deferred Tax Assets     2,215  
Less: Valuation Allowance     (2,215 )
Net deferred tax asset   $ —    

 

The net federal operating loss carry forward will expire between 2033. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.

 

 

NOTE C - CAPITAL STOCK

 

PREFERRED STOCK

 

The Company currently has not authorized any class of Preferred stock.

 

COMMON STOCK

 

The Company is authorized to issue 75,000,000 shares of common stock, par value $0.001 per share. The company has 6,789,298 shares issued at the year ended December 31, 2013.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, inc. At that time the shares acquired by David Funderburk were the only shares issued from Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

On August 15, 2013 the Company issued 80,000 shares of restricted 144 common stock per a contract with Blue Sky Media Corporation (advertising services valued at $8,000 or $0.10 per share).

 

On September 23, 2013 the Company issued 250,000 shares of restricted 144 common stock to Janice Douglas for $0.10 per share for a total of $25,000. On September 25, 2013 the Company issued 3,500 shares to Steve Lynch for consulting\marketing services valued at $0.10 per share.

 

F-27

 

 

NOTE D - COMMITMENTS AND CONTINGENCIES

 

PURCHASE AGREEMENTS

 

On January 11, 2013 the Company's subsidiary, Autovative Products, Inc. (newly formed subsidiary on December 31, 2012 in the State of Montana) entered into a Marketing/Sales Contract with OTW Enterprises LLC. OTW Enterprises LLC is the manufacturer of the Portable Tow Truck and the Overhead Door Saver. The contract entitles the Company to exclusive marketing rights within the USA and Europe for the Portable Tow Truck and the Overhead Door Saver.

 

 

NOTE E - RELATED PARTY TRANSACTIONS

 

The Company neither owns nor leases any real or personal property. An officer of the corporation provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interest. The Company has not formulated a policy for the resolution of such conflicts.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, inc. At that time the shares acquired by David Funderburk were the only shares issued from Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

An additional 600,000 shares of stock for were issued at par value of $0.001 per share to David Funderburk for a total of $600.

 

After the Company became independent from its predecessor, Autovative Products, Inc.,The Company changed compensation of the officer from commissions to payroll. The officer of the Company received wages of $7,500 for the three months ended December 31, 2013.

 

 

F-28

 

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

GENERAL

 

We were incorporated in Nevada on December 10, 2012 and we have elected, for the purpose of filing our Registration Statement with the SEC and preparing our audit, September 30, 2013 as our fiscal year end.

 

We were formed to develop businesses, assets and opportunities, some acquired and contributed from third parties and our founding shareholders, in the trucking/automobile special parts production and distribution industry and some related fields. We have been, initially, capitalized through the acquisition of Assets from our founding shareholder, outside producers, cash flows from the distribution of products and the proceeds from a Private Placement offering.

 

Significant Accounting Policies and Estimates

 

Management's Discussion and Analysis of Financial Condition and Results of Operations discusses the Company's consolidated financial statements which have been prepared in accordance with accounting principals generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experiences and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

Revenue Recognition

 

We recognize revenue from product sales or services rendered when the following four criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured. Revenues from design services provided are recorded upon billing of completed services.

 

We evaluate whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions as determined by Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 605-45-45, Overall Considerations of Reporting Revenue Gross as a Principal Versus Net as an Agent. We are primarily obligated in the transaction, subject to credit risk, have latitude in establishing prices and selecting suppliers, and risk of replacing lost shipments, therefore revenue is recorded at the gross sales price.

 

Product sales represent revenue from the sale of products and related shipping fees where we are the seller of record. Product sales and shipping revenues are recorded when the products are shipped and title passes to customers.

 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires us to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates.

 

Results of Operations

 

For The Year Ended September 30, 2013(Since inception December 10, 2012) And the Period ended December 31, 2013 And the Predecessor Periods for the Years ended December 31, 2012 and December 31, 2011.

 

For the year ended September 30, 2013 we had total revenues of $62,673, derived primarily from the distribution of the Portable Tow Truck units with a cost of goods sold or $47,696, and total operating expenses of $36,305. Net losses were ($6,328). At quarter ended December 31, 2013 we had total revenues of $28,556, derived primarily from the distribution of the Portable Tow Truck units with a cost of goods sold of $21,248, and total operating expenses of $14,639. Net Income for the period was $7,669. For the Predecessor year ended December 31, 2011 we had total revenues of $120,690, derived primarily from the distribution of the Portable Tow Truck units with a cost of goods sold of $46,544, and total operating expenses of $59,921. Net income was $14,225. For the Predecessor year ended December 31, 2012 we had total revenues of $74,300, derived primarily from the distribution of the Portable Tow Truck units with a cost of goods sold of $40,368, and total operating expenses of $67,907. Net losses were ($33,975). It is the intention of the Company to continue to develop and distribute its products; however, there is no assurance the Company will be able to generate Net Income over the long term.

 

For the year ended September 30, 2013 our total revenues inclusive of other income of $77,673 were derived primarily from the sales of the Company's Portable Tow Truck units to FedEx and UPS. $62,673 was derived from the sales of the Portable Tow Truck Units (cost of goods sold of $47,696) and $15,000 as other income, was derived from the sale of territories for retail only sales of the Portable Tow Truck Units.

 

Our operating expenses for the year ended September 30, 2013 were $36,305 comprised of commissions of $8,485, professional fees of $25,131 and general and administrative cost of $2,689.

 

For the quarter ended December 31, 2013 our total revenues of $28,556 were derived primarily from the sales of the Company's Portable Tow Truck units to FedEx and UPS with cost of goods sold of $47,696. $15,000 as other income was derived from the sale of territories for retail only sales of the Portable Tow Truck Units.

 

Our operating expenses for the quarter ended December 31, 2013 were $14,639 comprised of commissions of $8,485, professional fees of $25,131 and general and administrative cost of $2,689.

 

 

For the Predecessor's years ended December 31, 2011 and December 31, 2012, respectively, total revenues of $120,690 and $74,300 were derived primarily from the sales of the Company's Portable Tow Truck units to FedEx and UPS. $63,253 and $53,300 were derived from the sales of the Portable Tow Truck Units (cost of goods sold of $46,544 and $40,368).

 

Operating expenses for the Predecessor years ended December 31, 2011 and December 31, 2012, respectively, were $59,921 and $67,907 comprised of commissions of $19,266 and 12,932, professional fees of $7,995 and $34,927 and general and administrative cost of $672 and $2,548.

 

For the quarter ended December 31, 2013 our total revenues of $28,556 were derived primarily from the sales of the Company's Portable Tow Truck units to FedEx and UPS. Cost of goods sold of $47,696. $15,000 as other income was derived from the sale of territories for retail only sales of the Portable Tow Truck Units.

 

 

Liquidity and Capital Resources

 

As of September 30, 2013 the Company had cash on hand of $81,362, total current assets of $89,677, total assets of $89,677, total current liabilities of $46,906 and total stockholder's equity of $42,771. The Company's cash was generated from revenue from its sales of its Portable Tow Truck units, sale of a territory for retail sales, and proceeds from a Private Placement of its shares.

 

As of December 31, 2013 the Company had cash on hand of $40,080, total current assets of $74,861, total assets of $74,861, total current liabilities of $24,420 and total stockholder's equity of $50,440. The Company's cash was generated from revenue from its sales of its Portable Tow Truck units, sale of a territory for retail sales.

 

As of December 31, 2011 the Predecessor had cash on hand of $28,343, total current assets of $46,218, total assets of $46,218, total current liabilities of $45,255 and total stockholder's equity of $993. The Company's cash was generated from revenue from its sales of its Portable Tow Truck units, sale of a territory for retail sales.

 

As of December 31, 2012 the Predecessor had cash on hand of $1,774, total current assets of $15,657, total assets of $15,657, total current liabilities of $49,565 and total stockholder's equity of $(33,907). The Company's cash was generated from revenue from its sales of its Portable Tow Truck units, sale of a territory for retail sales.

 

The Company believes it has sufficient cash resources available to fund its primary operation for the next ten (10) months based on current cash.

 

It is likely that sales revenues will continue to either remain at the same level or increase through the next two quarters of the year and then we would expect to see sales decline as the Portable tow truck Units have seasonal applications and our largest sales to UPS and FedEx are anticipated to be from the beginning of fall through early spring.

 

We believe that in order for the Company's sales revenues to increase it is paramount that the Company engages in sales agreements with additional trucking fleets for both its Portable Tow Truck units and its Overhead Door Saver units. However there is no assurance that any additional sale will be made. Further there is no assurance that our sales revenues will not continue to decrease over the revenues of year end 2013.

 

The Company has no, current, off balance sheet arrangements and does not anticipate entering into any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition. The Company has no agreements in place with its shareholders, officer and director or with any third parties to fund operations beyond the end of the Company's 2014 year end. The Company has not negotiated nor has available to it any other third party sources of liquidity.

 

Controls and Procedures

 

As required by SEC rules, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures at the end of our fiscal year. This evaluation was carried out under the supervision and with the participation of our principal manager who is both our Chief Executive Officer and our Chief Financial Officer. Based upon this evaluation we have concluded that the design and operation of our disclosure controls and procedures are effective.


 

26


 

6,789,298 Shares

 

AUTOVATIVE TECHNOLOGIES, INC

Common stock

Prospectus

May 29, 2014

 

AUTOVATIVE TECHNOLOGIES, INC

1010 Industrial Road #70 Boulder City, NV 89005

www.AutovativeProducts.com

760-732-5868

 

Until ___________________________, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

 

PART II - INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 13. Other Expenses of Issuance and Distribution*

 

The following table sets forth all estimated costs and expenses, other than underwriting discounts, commissions and expense allowances, payable by the issuer in connection with the maximum offering for the securities included in this registration statement:

 

    Amount  
SEC registration fee   $ 60.45  
Printing and shipping expenses     100.00  
Legal fees and expenses     2,000.00  
Accounting fees and expenses     7,000.00  
Transfer agent and misc. expenses     2,500.00  
         
Total   $ 11,660.45  

 

*All amounts are estimates other than the Commission's registration fee. We are paying all expenses of the offering listed above. No portion of these expenses will be borne by the selling shareholders. The selling shareholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.

 

 

   
Item 14. Indemnification of Directors and Officers.

 

          The statutes, charter provisions, bylaws, contracts or other arrangements under which controlling persons, directors or officers of the issuer are insured or indemnified in any manner against any liability which they may incur in such capacity are as follows:

 

          Section 145 of the Nevada General Corporation Law provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses including attorneys' fees, judgments, fines and amounts paid in settlement in connection with various actions, suits or proceedings, whether civil, criminal, administrative or investigative other than an action by or in the right of the corporation, a derivative action, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful. A similar standard is applicable in the case of derivative actions, except that indemnification only extends to expenses including attorneys' fees incurred in connection with the defense or settlement of such actions and the statute requires court approval before there can be any indemnification where the person seeking indemnification has been found liable to the corporation. The statute provides that it is not exclusive of other indemnification that may be granted by a corporation's certificate of incorporation, bylaws, agreement, a vote of stockholders or disinterested directors or otherwise.

 

The Company's Certificate of Incorporation provides that it will indemnify and hold harmless, to the fullest extent permitted by Section 145 of the Nevada General Corporation Law, as amended from time to time, each person that such section grants us the power to indemnify.

 

          The Nevada General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for:

 

-   any breach of the director's duty of loyalty to the corporation or its stockholders;

 

-   acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

 

-   payments of unlawful dividends or unlawful stock repurchases or redemptions; or

 

-   any transaction from which the director derived an improper personal benefit.

 

The Company's Certificate of Incorporation provides that, to the fullest extent permitted by applicable law, none of our directors will be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director. Any repeal or modification of this provision will be prospective only and will not adversely affect any limitation, right or protection of a director of our company existing at the time of such repeal or modification.

 

Item 15. Recent Sales of Unregistered Securities

 

The Company is authorized to issue 75,000,000 shares of common stock, par value .001 per share. The company has 6,789,298 shares issued at the year ended September 30, 2013.

 

A transaction closed on July 30, 2013 in which David Funderburk acquired 100,000 restricted shares of Autovative Technologies, Inc. from it's Predecessor, Autovative Products, inc. At that time the shares acquired by David Funderburk were the only shares issued from Autovative Technologies, Inc. On August 14, 2013 a total of 135,798 restricted shares of stock of Autovative Technologies, Inc., the Registrant in these S-1 and S-1/A filings were issued to 33 shareholders of Autovative Products, Inc. on a pro rata based upon the number of shares of Autovative Products, Inc.(the Predeccessor) at the time of closing.

On August 15, 2013 the Company issued 80,000 shares of restricted 144 common stock per a contract with Blue Sky Media Corporation (advertising services valued at $8,000 or $0.10 per share).

 

On September 23, 2013 the Company issued 250,000 shares of restricted 144 common stock to Janice Douglas for $0.10 per share for a total of $25,000. On September 25, 2013 the Company issued 3,500 shares to Steve Lynch for consulting\marketing services valued at $0.10 per share.

 

These shares were issued in reliance on the exemption under Section 4(2) of the Securities Act of 1933, as amended (the "Act"). These shares of our common stock qualified for exemption under Section 4(2) of the Securities Act of 1933 since the issuance shares by us did not involve a public offering. The offering was not a "public offering" as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of shares offered. We did not undertake an offering in which we sold a high number of shares to a high number of investors. In addition, the shareholder had the necessary investment intent as required by Section 4(2) since she agreed to and received share certificates bearing a legend stating that such shares are restricted pursuant to Rule 144 of the 1933 Securities Act. This restriction ensures that these shares would not be immediately redistributed into the market and therefore not be part of a "public offering." Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act of 1933 for this transaction.

  

As of September 30, 2013 we sold 250,000 shares of common stock to 1 investor, at a price per share of $0.10 per share for net proceeds of $25,000. The following sets forth the identity of the class of persons to whom we sold these shares and the amount of shares for each shareholder:

 

Shareholder   Shares
Janice Douglas   250,000

 

The Common Stock issued in our Private Offering was issued pursuant to Reg D of the Securities Act of 1933.

 

         
  (A)     No general solicitation or advertising was conducted by us in connection with the offering of any of the Shares.
         
  (B)     At the time of the offering we were not: (1) subject to the reporting requirements of Section 13 or 15 (d) of the Exchange Act; or (2) an "investment company" within the meaning of the federal securities laws.
         
  (C)     Neither we, nor any of our predecessors, nor any of our directors, nor any beneficial owner of 10% or more of any class of our equity securities, nor any promoter currently connected with us in any capacity has been convicted within the past ten years of any felony in connection with the purchase or sale of any security.
         
  (D)     The offers and sales of securities by us pursuant to the offerings were not attempts to evade any registration or resale requirements of the securities laws of the United States or any of its states.
         
  (E)     None of the investors are affiliated with any of our directors, officers or promoters or any beneficial owner of 10% or more of our securities.

 

We have never utilized an underwriter for an offering of our securities. Other than the securities mentioned above, we have not issued or sold any securities.

 

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Item 16. Exhibits Index.

 

The following exhibits marked are filed with this Registration Statement:

 

Number   Exhibit Name
         
  3.1     *Certificate of Incorporation of the Company.
  3.2     *By-Laws
  3.3     *Articles of Incorporation
  5.1      Opinion of Mont E Tanner, Attorney at Law regarding legality
  23.1     Consent of Kyle L. Tingle, CPA, LLC herein
  10.1     OTW\Amended Company Contract

*Incorporated by reference to S-1 Registration Statement.

 

Item 17. Undertakings

 

The undersigned registrant undertakes:

 

(1) To file, during any period in which offer or sales are being made, a post-effective amendment to this registration statement:

 

I. To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

 

II. To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post effective amendment) which, individually or in the aggregate, represent a fundamental change in the information in the registration statement;

 

III. To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to the information in the Registration Statement.

 

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of securities at that time shall be deemed to be the initial bona fide offering.

 

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

 

(4) That, if the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

 

(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

i.   Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

 

ii.   Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

 

iii.   The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

 

iv.   Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 

(6) The registrant shall request acceleration  pursuant to  Rule  461 under the Securities Act and there insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

 

Subject to the terms and conditions of Section 15(d) of the Securities Exchange Act of 1934, the undersigned Registrant hereby undertakes to file with the Securities and Exchange Commission any supplementary and periodic information, documents, and reports as may be prescribed by any rule or regulation of the Commission heretofore or hereafter duly adopted pursuant to authority conferred to that section.

 

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers, and controlling persons of the Registrant pursuant to our certificate of incorporation or provisions of Nevada law, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission the indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. If a claim for indemnification against liabilities (other than the payment by the Registrant) of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit, or proceeding is asserted by a director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether the indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of the issue.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-1 and has duly caused this registration statement to be signed on our behalf by the undersigned, in Boulder, NV on May 29, 2014.

 

 

  AUTOVATIVE TECHNOLOGIES, INC  
       
Dated: May 29, 2014 By: /s/ David Funderburk  
    David Funderburk,  
    President, Treasurer and Secretary (Principal Executive, Financial and Accounting Officer)  
       

 

In accordance with the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates stated.

 

 

     
SIGNATURE TITLE DATE
     

/S/ David Funderburk

David Funderburk

Director, President, Treasurer and Secretary (Principal Executive, Financial and Accounting Officer)

May 29, 2014

 

     
     

 

29


 

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

EXHIBITS

TO

 

REGISTRATION STATEMENT

 

ON FORM S-1/A

 

UNDER

 

THE SECURITIES ACT OF 1933

AUTOVATIVE TECHNOLOGIES, INC

 

 

30

 

 


Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘S-1/A’ Filing    Date    Other Filings
5/31/14None on these Dates
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12/31/13
9/30/13
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9/23/13
8/15/13
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7/30/13
3/29/13
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1/1/13
12/31/12
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12/10/12
1/12/12
12/31/11
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