x
|
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
FOR THE QUARTERLY PERIOD ENDED JUNE
30, 2007
|
o
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT
|
Delaware
|
22-1436279
|
(State
or other jurisdiction of incorporation or organization)
|
(IRS
Employer Identification
No.)
|
· |
We
previously concluded that an important trademark acquired in a business
combination had an indefinite life. The accompanying financial statements
and notes have been revised to provide for an expected life for this
trademark of ten years. Amortization of this intangible asset is
reflected
in statements of operations.
|
· |
We
previously recognized as an asset certain deferred financing costs
in
connection with our reverse merger with Tech Labs, Inc. Since principles
of accounting for reverse merger preclude the recognition of assets
other
than those of the accounting acquiree, we have revised our balance
sheet
to eliminate this asset.
|
· |
We
have certain debt agreements and registration rights agreements that
are
in default. We have modified our disclosures to provide more information
about the nature of defaults, the remedies of the investors and our
conclusions related to the accounting consequences.
|
|
PART
1 FINANCIAL INFORMATION
|
|||
|
|
|||
Item
1.
|
Financial
Statements (Unaudited)
|
|||
|
|
|||
|
Consolidated
Balance Sheet (Restated)
|
6
|
||
|
|
|||
|
Consolidated
Statements of Operations (Restated)
|
8
|
||
|
||||
|
Consolidated
Statement of Stockholders’ Equity (Deficit) (Restated)
|
9
|
||
|
||||
|
Consolidated
Statements of Cash Flows (Restated)
|
10
|
||
|
||||
|
Notes
to Consolidated Financial Statements
|
12
|
||
|
|
|
||
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
32
|
||
|
|
|
||
Item
3.
|
Controls
and Procedures
|
50
|
||
|
|
|
||
|
PART
II OTHER INFORMATION
|
|
||
|
|
|
||
Item
1.
|
Legal
Proceedings
|
52
|
||
|
|
|
||
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
52
|
||
|
|
|
||
Item
3.
|
Defaults
Upon Senior Securities
|
52
|
||
|
|
|
||
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
52
|
||
|
|
|
||
Item
5.
|
Other
Information
|
52
|
||
|
|
|
||
Item
6.
|
Exhibits
|
53
|
||
|
|
|
||
SIGNATURES
|
|
55
|
ASSETS
|
||||
Current
assets:
|
||||
Cash
|
$
|
116,030
|
||
Inventories
|
51,461
|
|||
Prepaid
expenses and other current assets
|
24,578
|
|||
Total
current assets
|
192,069
|
|||
Property
and equipment - net
|
57,672
|
|||
Note
receivable - Biodiesel Solutions
|
200,000
|
|||
Financing
Fees, net of accumulated amortization of $17,507
|
162,493
|
|||
Intangibles,
net of accumulated amortization of $14,117
|
292,883
|
|||
Goodwill
|
93,705
|
|||
Total
assets
|
$
|
998,822
|
RENEWAL
FUELS, INC.
UNAUDITED
CONSOLIDATED BALANCE SHEET
AS
OF JUNE 30, 2007
(Restated)
(-continued)
|
||||
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||
Liabilities
|
||||
Current
liabilities:
|
||||
Accounts
payable
|
$
|
199,409
|
||
Current
maturities of convertible debt
|
1,276,686
|
|||
Customer
deposits
|
2,932
|
|||
Total
current liabilities
|
1,479,027
|
|||
Convertible
debt, less current maturities
|
764,169
|
|||
Total
liabilities
|
2,243,196
|
|||
Commitments
and contingencies
|
||||
Stockholders’
equity (deficit):
|
||||
Capital
stock:
|
||||
Preferred
stock - par value of $.001; 20,000,000 shares authorized;
|
||||
no
shares issued and outstanding
|
-
|
|||
Common
stock - par value of $.001; 3,000,000,000 shares
authorized;
|
||||
23,805,126
shares issued and outstanding
|
23,805
|
|||
Additional
paid-in capital
|
4,733,359
|
|||
Accumulated
deficit
|
(6,001,538
|
)
|
||
Total
stockholders’ equity
|
(1,244,374
|
)
|
||
Total
liabilities and stockholders’ equity
|
$
|
998,822
|
||
See
accompanying notes to consolidated financial
statements.
|
Successor
Business
|
Predecessor
Business
|
|||||||||||||||
Three
Months Ended
June
30, 2007
Restated
|
March
9, 2007
(Date
of Inception)
to
June 30, 2007 Restated
|
Three
Months Ended
March
31, 2007
|
Three
Months Ended
June
30, 2006
|
Six
Months Ended
June
30, 2006
|
||||||||||||
Sales
|
$
|
244,087
|
$
|
244,087
|
$
|
104,360
|
$
|
503,061
|
$
|
1,067,427
|
||||||
Cost
of goods sold
|
142,342
|
142,342
|
76,802
|
331,449
|
683,416
|
|||||||||||
Gross
profit
|
101,745
|
101,745
|
27,558
|
171,612
|
384,011
|
|||||||||||
Operating
expenses:
|
||||||||||||||||
Employee
compensation and benefits
|
32,696
|
34,272
|
52,320
|
69,430
|
125,544
|
|||||||||||
Stock-based
transaction expense
|
5,131,231
|
5,131,231
|
-
|
-
|
-
|
|||||||||||
Occupancy
and equipment
|
8,257
|
8,257
|
18,666
|
23,900
|
69,930
|
|||||||||||
Advertising
|
43,815
|
43,983
|
8,474
|
8,762
|
18,088
|
|||||||||||
Professional
fees
|
317,898
|
349,741
|
8,474
|
2,949
|
12,029
|
|||||||||||
Other
general and administrative
|
100,666
|
100,494
|
19,085
|
26,691
|
80,874
|
|||||||||||
Total
operating expenses
|
5,634,563
|
5,667,979
|
107,019
|
131,732
|
306,465
|
|||||||||||
Operating
income (loss)
|
(5,532,818
|
)
|
(5,556,234
|
)
|
(79,461
|
)
|
39,880
|
77,546
|
||||||||
Interest
income
|
755
|
755
|
-
|
-
|
-
|
|||||||||||
Interest
expense
|
(413,500
|
)
|
(415,427
|
)
|
-
|
-
|
-
|
|||||||||
Financing
fees
|
(20,632
|
)
|
(20,632
|
)
|
-
|
-
|
-
|
|||||||||
Net
income (loss)
|
$
|
(5,966,195
|
)
|
$
|
(6,001,538
|
)
|
$
|
(79,461
|
)
|
$
|
39,880
|
$
|
77,546
|
|||
Net
income (loss) per share:
|
||||||||||||||||
Basic
|
$
|
(0.25
|
)
|
$
|
(0.25
|
)
|
$
|
(.01
|
)
|
$
|
.01
|
$
|
.01
|
|||
Diluted
|
$
|
(0.25
|
)
|
$
|
(0.25
|
)
|
$
|
(.01
|
)
|
$
|
.01
|
$
|
.01
|
|||
Weighted
average shares outstanding:
|
||||||||||||||||
Basic
|
23,668,270
|
23,650,442
|
7,000,000
|
7,000,000
|
7,000,000
|
|||||||||||
Diluted
|
23,668,270
|
23,650,442
|
7,000,000
|
7,000,000
|
7,000,000
|
|||||||||||
See
accomSee accompanying notes to consolidated financial
statements.
|
Additional
|
||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Paid-In
|
Accumulated
|
|||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||||||||||||
Balances,
March 9, 2007 (Inception)
|
-
|
$
|
-
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||
Common
stock sold on March 9, 2007 to founders for cash
|
-
|
-
|
-
|
-
|
57,279
|
-
|
57,279
|
|||||||||||||||
Assumption
of net liabilities
|
-
|
-
|
-
|
-
|
(1,677,020
|
)
|
-
|
(1,677,020
|
)
|
|||||||||||||
Stock-based
transaction expense related to common stock sold to
founders
|
-
|
-
|
-
|
-
|
5,131,231
|
-
|
5,131,231
|
|||||||||||||||
Common
stock issued in exchange for net liabilities in a recapitalization
on
April 20, 2007
|
-
|
-
|
673,356
|
673
|
(673
|
)
|
-
|
-
|
||||||||||||||
Preferred
stock issued in reverse merger
|
343,610
|
343
|
-
|
-
|
(343
|
)
|
-
|
-
|
||||||||||||||
Conversion
of preferred stock to common stock on June 21, 2007
|
(343,610
|
)
|
(343
|
)
|
22,907,323
|
22,907
|
(22,564
|
)
|
-
|
-
|
||||||||||||
Common
stock issued on conversion of convertible debentures
|
-
|
-
|
224,447
|
225
|
82,675
|
-
|
82,900
|
|||||||||||||||
Common
stock warrants issued
|
-
|
-
|
-
|
-
|
238,932
|
-
|
238,932
|
|||||||||||||||
Beneficial
conversion feature of convertible debt instruments issued or
assumed
|
-
|
-
|
-
|
-
|
923,841
|
-
|
923,841
|
|||||||||||||||
Net
loss for the period
|
-
|
-
|
-
|
-
|
-
|
(6,001,538
|
)
|
(6,001,538
|
)
|
|||||||||||||
Balances,
June 30, 2007
|
-
|
$
|
-
|
23,805,126
|
$
|
23,805
|
$
|
4,553,359
|
$
|
(6,001,538
|
)
|
$
|
(1,244,374
|
)
|
Successor
Business
|
Predecessor
Business
|
|||||||||
March
9, 2007
(Date
of Inception) to
June
30, 2007
(Restated)
|
Three
Months
Ended
March
31, 2007
|
Six
Months
Ended
June
30, 2006
|
||||||||
Cash
Flows From Operating Activities:
|
||||||||||
Net
income (loss)
|
$
|
(6,001,538
|
)
|
$
|
(79,461
|
)
|
$
|
77,546
|
||
Adjustments
to reconcile net income (loss) to net cash
provided
by (used in) operating activities:
|
||||||||||
Depreciation
and amortization
|
32,854
|
471
|
8,171
|
|||||||
Amortization
of debt discounts
|
355,949
|
-
|
-
|
|||||||
Stock-based
transaction expense
|
5,131,231
|
-
|
-
|
|||||||
Changes
in operating assets and liabilities, net:
|
||||||||||
Accounts
receivable
|
-
|
-
|
11,198
|
|||||||
Inventories
|
(17,035
|
)
|
26,151
|
87,525
|
||||||
Other
current assets
|
(24,577
|
)
|
11,915
|
(1,975
|
)
|
|||||
Accounts
payable and accrued expenses
|
(2,490
|
)
|
(5,857
|
)
|
(33,397
|
)
|
||||
Accrued
interest
|
57,551
|
-
|
-
|
|||||||
Customer
deposits
|
2,932
|
(12,224
|
)
|
12,793
|
||||||
Net
Cash Provided By (Used In) Operating Activities
|
(465,123
|
)
|
(59,005
|
)
|
161,861
|
|||||
Cash
Flows From Investing Activities:
|
||||||||||
Acquisition
of FuelMeister assets
|
(494,426
|
)
|
-
|
-
|
||||||
Note
receivable - Biodiesel Solutions
|
(200,000
|
)
|
-
|
-
|
||||||
Purchases
of property and equipment
|
(1,700
|
)
|
-
|
(759
|
)
|
|||||
Refund
of deposit
|
-
|
-
|
5,376
|
|||||||
Net
Cash Provided By (Used In) Investing Activities
|
(696,126
|
)
|
-
|
4,617
|
||||||
Cash
Flows From Financing Activities:
|
||||||||||
Proceeds
from issuance of common stock
|
57,279
|
-
|
-
|
|||||||
Proceeds
from issuance of warrants
|
238,932
|
-
|
-
|
|||||||
Proceeds
from issuance of long-term debt
|
1,161,068
|
-
|
-
|
|||||||
Payment
of debt issuance costs
|
(180,000
|
)
|
-
|
-
|
||||||
Net
contributions (distributions) from (to) owner
|
-
|
31,953
|
(356,918
|
)
|
||||||
Net
Cash Provided By (Used In) Financing Activities
|
1,277,279
|
31,953
|
(356,918
|
)
|
||||||
Net
Increase (Decrease) In Cash
|
116,030
|
(27,052
|
)
|
(190,440
|
)
|
|||||
Cash
- Beginning of period
|
-
|
52,626
|
276,850
|
|||||||
Cash
- End of period
|
$
|
116,030
|
$
|
25,574
|
$
|
86,410
|
||||
RENEWAL
FUELS, INC.
UNAUDITED
CONSOLIDATED STATEMENT OF CASH FLOWS
|
||||||||||
(-continued)
|
||||||||||
Successor
Business
|
Predecessor
Business
|
|||||||||
Supplemental
Disclosure Of Cash Flow Information -
|
||||||||||
Interest
paid
|
$
|
1,927
|
$
|
-
|
$
|
-
|
||||
Income
taxes paid
|
$
|
-
|
$
|
-
|
$
|
-
|
||||
Supplemental
Disclosures Of Non-Cash Investing And Financing
Activities:
|
||||||||||
Net
liabilities assumed in a recapitalization
|
$
|
1,677,020
|
$
|
-
|
$
|
-
|
Net
liabilities assumed:
|
||||
Accounts
payable
|
$
|
203,992
|
||
Long
term debt, including accrued interest
|
1,473,028
|
|||
Net
liabilities assumed
|
$
|
1,677,020
|
||
Net
assets acquired:
|
||||
Inventory
|
$
|
34,426
|
||
Fixed
assets
|
9,145
|
|||
Website
domain
|
50,150
|
|||
Tradename
|
118,000
|
|||
Customer
lists, engineering drawings and other intangibles
|
189,000
|
|||
Goodwill
|
93,705
|
|||
Net
assets acquired
|
$
|
494,426
|
||
Issued
|
Statement
|
|
February
2006
|
FAS
155 - “Accounting for Certain Hybrid Financial Instruments; an amendment
of Financial Accounting Standard Nos. 133 and 140"
|
|
March
2006
|
FAS
156 - “Accounting for Servicing of Financial Assets, an amendment of FASB
Statement No. 140, Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities”
|
|
June
2006
|
FAS
Interpretation 48 - "Accounting for Uncertainty in Income
Taxes"
|
|
September
2006
|
FAS
157 - “Fair Value Measurements”
|
|
September
2006
|
FAS
158 - “Employers’ Accounting for Defined Benefit Pension and Other
Postretirement Plans” - an amendment of FASB Statements No. 87, 88, 106,
and 132(R)”
|
|
February
2007
|
FAS
159 - “The Fair Value Option for Financial Assets and Financial
Liabilities—Including an amendment of FASB Statement No.
115”
|
Computer
equipment and software
|
$
|
50,792
|
||
Production
and shop equipment
|
7,051
|
|||
Office
furniture and equipment
|
1,058
|
|||
58,901
|
||||
Less
accumulated depreciation and amortization
|
1,229
|
|||
Property
and equipment - net
|
$
|
57,672
|
|
As
of June 30, 2007
|
|||||||||
|
Gross
Carrying Amount
|
Accumulated
Amortization
|
Net
Carrying Amount
|
|||||||
|
|
|
|
|||||||
Amortized
Intangible Assets:
|
|
|
|
|||||||
Customer
lists
|
$
|
70,000
|
$
|
1,167
|
$
|
68,833
|
||||
Engineering
drawings
|
70,000
|
3,500
|
66,500
|
|||||||
Non-compete
agreement
|
46,000
|
5,750
|
40,250
|
|||||||
Tradename
|
118,000
|
2,950
|
115,050
|
|||||||
Patent
application
|
3,000
|
750
|
2,250
|
|||||||
|
$
|
307,000
|
$
|
14,117
|
$
|
292,883
|
||||
Unamortized
Intangible Assets:
|
||||||||||
Goodwill
|
93,705
|
|||||||||
|
$
|
93,705
|
||||||||
Aggregate
Amortization Expense:
|
||||||||||
Quarter
ended June 30, 2007
|
$
|
14,117
|
||||||||
|
||||||||||
Estimated
Amortization Expense:
|
||||||||||
Year
ending December 31, 2007
|
$
|
28,234
|
||||||||
Year
ending December 31, 2008
|
54,217
|
|||||||||
Year
ending December 31, 2009
|
36,217
|
|||||||||
Year
ending December 31, 2010
|
30,467
|
|||||||||
Year
ending December 31, 2011
|
30,467
|
|||||||||
Year
ending December 31, 2012
|
19,967
|
|||||||||
Thereafter
|
93,314
|
|||||||||
|
$
|
292,883
|
New
Obligations
|
||||
Cornell
Capital Partners L.P., $1,000,000 convertible debenture, due April
20,
2009, interest at prime + 2.75% (11% at June 30, 2007)
|
$
|
1,000,000
|
||
Less
unamortized discount from warrants and beneficial conversion
feature
|
(385,427
|
)
|
||
614,573
|
||||
Cornell
Capital Partners L.P., $400,000 convertible debenture, due May 31,
2009,
interest at prime + 2.75% (11% at June 30, 2007)
|
400,000
|
|||
Less
unamortized discount from beneficial conversion feature
|
(396,504
|
)
|
||
3,496
|
||||
Prior
Obligations (in default)
|
||||
Montgomery
Equity Partners, Ltd., $300,000 15% convertible debenture, due on
demand,
including accrued interest of $67,685
|
367,685
|
|||
Montgomery
Equity Partners, Ltd., $537,220 15% convertible debenture, due on
demand,
including accrued interest of $121,206
|
658,426
|
|||
Cornell
Capital Partners L.P., $85,100 6.5% convertible promissory note,
due on
demand, including accrued interest of $61,000
|
146,100
|
|||
LH
Financial, $156,080 18.0% convertible promissory note, due on demand,
including accrued interest of $94,495
|
250,575
|
|||
2,040,855
|
||||
Less:
current maturities
|
1,276,686
|
|||
Long-term
debt
|
$
|
764,169
|
As
Reported
|
Restatement
Adjustments
|
As
Restated
|
|||||||||||
Balance
Sheet as of June 30, 2007
|
|||||||||||||
Finance
fees net
|
$
|
1,678,896
|
$
|
(1,516,403
|
)
|
(A
|
)
|
$
|
162,493
|
||||
Intangible
assets, net
|
177,833
|
115,050
|
(B
|
)
|
292,883
|
||||||||
Paid-in
capital
|
6,410,378
|
(1,677,020
|
)
|
(A
|
)
|
4,733,359
|
|||||||
Accumulated
Deficit
|
(6,159,204
|
)
|
157,666
|
(C
|
)
|
(6,001,538
|
)
|
||||||
Statement
of Operations, Three Months Ended June 30, 2007
|
|||||||||||||
Other
general and administrative
|
97,716
|
2,950
|
(B
|
)
|
100,666
|
||||||||
Deferred
Financing fees
|
181,249
|
(160,617
|
)
|
(A
|
)
|
20,632
|
|||||||
Net
income (loss) per share
|
|||||||||||||
Basic
|
(0.26
|
)
|
0.01
|
(C
|
)
|
(0.25
|
)
|
||||||
Diluted
|
(0.26
|
)
|
0.01
|
(C
|
)
|
(0.25
|
)
|
||||||
Statement
of Operations, March 9, 2007 (Date of Inception) to June 30,
2007
|
|||||||||||||
Other
general & administrative
|
97,544
|
2,950
|
(B
|
)
|
100,494
|
||||||||
Deferred
Financing fees
|
181,249
|
(160,617
|
)
|
(A
|
)
|
20,632
|
|||||||
Net
income (loss) per share
|
|||||||||||||
Basic
|
(0.26
|
)
|
0.01
|
(C
|
)
|
(0.25
|
)
|
||||||
Diluted
|
(0.26
|
)
|
0.01
|
(C
|
)
|
(0.25
|
)
|
Name
|
Common
Shares
Received
|
|
Renewal
Biodiesel Shares Owned
|
|
Average
Price Paid
|
|||||
Crivello
Group LLC (1)
|
666,666
|
166,700
|
$
|
0.01
|
||||||
Frank
P. Crivello SEP IRA (1)
|
13,333,333
|
3,334,000
|
$
|
0.01
|
||||||
John
King
|
2,300,000
|
575,115
|
$
|
0.01
|
||||||
David
Marks (2)
|
2,700,000
|
675,135
|
$
|
0.01
|
||||||
Other
investors as a group (17)
|
3,907,324
|
977,029
|
$
|
0.01
|
||||||
22,907,323
|
5,727,979
|
|||||||||
(1) Mr.
Crivello is also the managing member of Crivello Group,
LLC.
|
||||||||||
(2) Of
the shares attributed to Mr. Marks, 200,000 shares are registered
in the
name of the Irrevocable Children’s Trust of which Mr. Marks is a trustee
and 200,000 are registered in the name of Phoenix Investors, LLC
of which
Mr. Marks is Managing Director.
|
· |
Results
of operations for the three months ended June 30, 2007
(successor);
|
· |
Results
of operations for the period March 9, 2007 (date of inception) through
June 30, 2007 (successor);
|
· |
Results
of operations for the three months ended June 30, 2006
(predecessor);
|
· |
Results
of operations for the three months ended March 31, 2007
(predecessor);
|
· |
Results
of operations for the six months ended June 30, 2006
(predecessor);
|
Net
Sales
|
$
|
244,087
|
100.0
|
%
|
|||
Cost
of sales
|
142,342
|
58.3
|
%
|
||||
Gross
Profit
|
101,745
|
41.7
|
%
|
||||
Operating
Expenses:
|
|||||||
Stock-based
transaction expense
|
5,131,231
|
2102.2
|
%
|
||||
General
and administrative expenses
|
451,260
|
184.9
|
%
|
||||
Advertising
expenses
|
43,815
|
18.0
|
%
|
||||
Occupancy
and equipment
|
8,257
|
3.4
|
%
|
||||
Total
Operating Expenses
|
5,634,563
|
2308.5
|
%
|
||||
Operating
Income (Loss)
|
(5,532,818
|
)
|
(2266.7
|
)%
|
|||
Net
financial expense
|
(433,377
|
)
|
(177.6
|
)%
|
|||
|
|||||||
Net
Income (Loss)
|
$
|
(5,966,195
|
)
|
(2444.0
|
)%
|
Net
Sales
|
$
|
244,087
|
100.0
|
%
|
|||
Cost
of sales
|
142,342
|
58.3
|
%
|
||||
Gross
Profit
|
101,745
|
41.7
|
%
|
||||
Operating
Expenses:
|
|||||||
Stock-based
transaction expense
|
5,131,231
|
2102.2
|
%
|
||||
General
and administrative expenses
|
484,508
|
198.5
|
%
|
||||
Advertising
expenses
|
43,983
|
18.0
|
%
|
||||
Occupancy
and equipment
|
8,257
|
3.4
|
%
|
||||
Total
Operating Expenses
|
5,667,979
|
2322.1
|
%
|
||||
Operating
Income (Loss)
|
(5,566,234
|
)
|
(2266.7
|
)%
|
|||
Net
financial expense
|
(435,304
|
)
|
(178.3
|
)%
|
|||
|
|||||||
Net
Income (Loss)
|
$
|
(6,001,538
|
)
|
(2458.8
|
)%
|
Net
Sales
|
$
|
503,061
|
100.0
|
%
|
|||
Cost
of sales
|
331,449
|
65.9
|
%
|
||||
Gross
Profit
|
171,612
|
34.1
|
%
|
||||
Operating
Expenses:
|
|||||||
General
and administrative expenses
|
99,070
|
19.7
|
%
|
||||
Advertising
expenses
|
8,762
|
1.7
|
%
|
||||
Occupancy
and equipment
|
23,900
|
4.8
|
%
|
||||
Total
Operating Expenses
|
131,732
|
26.2
|
%
|
||||
Operating
Income (Loss)
|
39,880
|
7.9
|
%
|
||||
Net
financial expense
|
-
|
0.0
|
%
|
||||
|
|||||||
Net
Income (Loss)
|
$
|
39,880
|
7.9
|
%
|
Net
Sales
|
$
|
104,360
|
100.0
|
%
|
|||
Cost
of sales
|
76,802
|
73.6
|
%
|
||||
Gross
Profit
|
27,558
|
26.4
|
%
|
||||
Operating
Expenses:
|
|||||||
General
and administrative expenses
|
79,879
|
76.5
|
%
|
||||
Advertising
expenses
|
8,479
|
8.1
|
%
|
||||
Occupancy
and equipment
|
18,666
|
17.9
|
%
|
||||
Total
Operating Expenses
|
107,042
|
102.6
|
%
|
||||
Operating
Income (Loss)
|
(79,461
|
)
|
(76.1)
|
%
|
|||
Net
financial expense
|
-
|
0.0
|
%
|
||||
|
|||||||
Net
Income (Loss)
|
$
|
(79,461
|
)
|
(76.1)
|
%
|
Net
Sales
|
$
|
1,067,427
|
100.0
|
%
|
|||
Cost
of sales
|
683,416
|
64.0
|
%
|
||||
Gross
Profit
|
384,011
|
36.0
|
%
|
||||
Operating
Expenses:
|
|||||||
General
and administrative expenses
|
218,447
|
20.5
|
%
|
||||
Advertising
expenses
|
18,088
|
1.7
|
%
|
||||
Occupancy
and equipment
|
69,930
|
6.6
|
%
|
||||
Total
Operating Expenses
|
306,465
|
28.7
|
%
|
||||
Operating
Income (Loss)
|
77,546
|
7.2
|
%
|
||||
Net
financial expense
|
-
|
0.0
|
%
|
||||
|
|||||||
Net
Income (Loss)
|
$
|
77,546
|
7.2
|
%
|
|
·
|
Revenue
Recognition
|
|
·
|
Allowance
for Doubtful Accounts
|
·
|
Derivative
Financial Instruments
|
|
|
·
|
Warranty
Obligations
|
·
|
Inventory
Obsolescence
|
Issued
|
Statement
|
|
February
2006
|
FAS
155 - “Accounting for Certain Hybrid Financial Instruments; an amendment
of Financial Accounting Standard Nos. 133 and 140" (“FAS
155”)
|
|
March
2006
|
FAS
156 - “Accounting for Servicing of Financial Assets, an amendment of FASB
Statement No. 140, Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities”
|
|
June
2006
|
FAS
Interpretation 48 - "Accounting for Uncertainty in Income
Taxes"
|
|
September
2006
|
FAS
157 - “Fair Value Measurements”
|
|
September
2006
|
FAS
158 - “Employers’ Accounting for Defined Benefit Pension and Other
Postretirement Plans” - an amendment of FASB Statements No. 87, 88, 106,
and 132(R)”
|
|
February
2007
|
FAS
159 - “The Fair Value Option for Financial Assets and Financial
Liabilities—Including an amendment of FASB Statement No.
115”
|
|
Exhibit
Number
|
Description
|
|
3.1
|
Amendment
to Certificate of Incorporation of Tech Laboratories, Inc.
(1)
|
|
3.2
|
Amended
and Restated By-laws of Tech Laboratories, Inc. (1)
|
|
10.1
|
Agreement
and Plan of Merger, dated April 20, 2007, among Tech Laboratories,
Inc.,
Renewal Fuels Acquisitions, Inc. and Renewal Fuels, Inc.
(1)
|
|
10.2
|
Asset
Purchase Agreement, dated March 30, 2007, among Crivello Group, LLC,
Renewal Fuels, Inc. and Biodiesel Solutions, Inc. (1)
|
|
10.3
|
Securities
Purchase Agreement, dated April 20, 2007, by and between Tech
Laboratories, Inc. and Cornell Capital Partners L.P.
(1)
|
|
10.4
|
$1,000,000
principal amount Secured Convertible Debenture, dated April 20, 2007,
by
and between Tech Laboratories, Inc. and Cornell Capital Partners
L.P.
(1)
|
|
10.5
|
Warrant
to purchase 18,000,000 shares of Common Stock of Tech Laboratories,
Inc.
dated April 20, 2007 (1)
|
|
10.6
|
Registration
Rights Agreement, dated April 20, 2007, by and between Tech Laboratories,
Inc. and Cornell Capital Partners L.P. (1)
|
|
10.7
|
Pledge
and Escrow Agreement, dated April 20, 2007, by and between Tech
Laboratories, Inc., David Gonzalez and Cornell Capital Partners L.P.
(1)
|
|
10.8
|
Restated
Security Agreement, dated April 20, 2007, by and between Tech
Laboratories, Inc. and Cornell Capital Partners L.P.
(1)
|
|
10.9
|
Services
Agreement between Renewal Fuels, Inc. and Biodiesel Solutions, Inc.,
dated
as of March 30, 2007 (1)
|
|
10.10
|
Settlement
Agreement between Tech Laboratories, Inc. and Stursburg & Veith, dated
as of April 25, 2007 (1)
|
|
10.11
|
Amendment
No. 1 to Secured Convertible Debenture No. TCHL-1-1, dated May 31,
2007,
by and between Tech Laboratories, Inc. and Cornell Capital Partners
L.P.
(2)
|
|
10.12
|
Amended
and Restated $1,000,000 principal amount Secured Convertible Debenture,
dated May 31, 2007, by and between Tech Laboratories, Inc. and Cornell
Capital Partners L.P. (2)
|
|
10.13
|
Amendment
No. 1 to Secured Convertible Debenture No. TCHL-1-2, dated May 31,
2007,
by and between Tech Laboratories, Inc. and Cornell Capital Partners
L.P.
(2)
|
|
10.14
|
$400,000
principal amount Secured Convertible Debenture, dated May 31, 2007,
by and
between Tech Laboratories, Inc. and Cornell Capital Partners L.P.
(2)
|
|
10.15
|
$300,000
principal amount Secured Convertible Debenture, dated December 27,
2005,
by and between Tech Laboratories, Inc. and Montgomery Equity Partners,
Ltd. (incorporated by reference to the exhibits to Registrant’s Form 8-K
filed on January 10, 2006).
|
|
10.16
|
Amendment
No. 1 to Secured Convertible Debenture No. MEP-2, dated May 31, 2007,
by
and between Tech Laboratories, Inc. and Montgomery Equity Partners,
Ltd.
(2)
|
|
10.17
|
Amended
and Restated $537,220 principal amount Secured Convertible Debenture,
dated December 27, 2005, by and between Tech Laboratories, Inc. and
Montgomery Equity Partners, Ltd. (incorporated by reference to the
exhibits to Registrant’s Form 8-K filed on January 10,
2006).
|
|
10.18
|
Amendment
No. 1 to Secured Convertible Debenture No. MEP-3, dated May 31, 2007,
by
and between Tech Laboratories, Inc. and Montgomery Equity Partners,
Ltd.
(2)
|
|
10.19
|
Agreement
and Plan of Merger, dated July 2, 2007, among Tech Laboratories,
Inc., BSI
Acquisitions, Inc. and Biodiesel Solutions, Inc. (3)
|
|
10.20
|
Securities
Purchase Agreement, dated July 2, 2007, by and between Tech Laboratories,
Inc. and Cornell Capital Partners L.P. (3)
|
|
10.21
|
$2,000,000
principal amount Secured Convertible Debenture, dated July 2, 2007,
by and
between Tech Laboratories, Inc. and Cornell Capital Partners L.P.
(3)
|
|
10.22
|
Warrant
to purchase 33,750,000 shares of Common Stock of Tech Laboratories,
Inc.
dated July 2, 2007 (3)
|
|
10.23
|
Amendment
No. 1 to Registration Rights Agreement, dated July 2, 2007, by and
between
Tech Laboratories, Inc. and Cornell Capital Partners L.P.
(3)
|
|
10.24
|
Security
Agreement, dated July 2, 2007, by and between Biodeisel Solutions,
Inc.,
Renewal Fuels, Inc. and Cornell Capital Partners L.P.
(3)
|
|
31.1
|
Certification
by Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
31.2
|
Certification
by Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
32.1
|
Certification
by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
|
32.2
|
Certification
by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
(1) Incorporated
by reference to Form 8-K filed on April 26, 2007
(2) Incorporated
by reference to Form 8-K filed on June 8, 2007
(3) Incorporated
by reference to Form 8-K filed on July 6,
2007
|
TECH LABORATORIES, INC. | ||
|
|
|
Dated: April 8, 2008 | By: | /s/ John King |
John King, |
||
Chief Executive Officer and Chief Financial
Office
(Principal Financial and Accounting Officer)
|