UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: MARCH 31, 2012
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________________________ to ______________________________________
Commission File Number: 1-3477
CATALYST RESOURCE GROUP, INC.
(Exact name of registrant as specified in its charter)
Florida 82-0190257
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer identification Number)
17011 Beach Blvd., Suite 1230, Huntington Beach, CA 92647 |
(Address of principal executive offices) (Zip Code) |
|
714-843-5455 |
(Registrant's telephone number, including area code) |
|
N/A |
(Former name, former address and former fiscal year, if changed since last report) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes [X] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] | Accelerated filer [ ] |
Non-accelerated filer [ ] | Smaller reporting company [X] |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: As of May 18, 2012, there were 457,120,574 shares of the issuer's non-assessable Common Stock, $.001 par value per share, (including 20,867,000 shares to be cancelled) and 9,958 shares of the issuer's Class B assessable Common Stock, $.001 par value, issued and outstanding.
CATALYST RESOURCE GROUP, INC.
(Formerly JEANTEX GROUP, INC.)
INDEX TO FORM 10-Q
PART I - FINANCIAL INFORMATION
Item 1- Financial Statements – Unaudited
Balance Sheets as of March 31, 2012 (Unaudited) and December 31, 2011
Statements of Operations for the Three Months Ended March 31, 2012 and 2011 and the period from January 1, 2007 (Inception) to March 31, 2012 (Unaudited
Statements of Cash Flows for the Three Months Ended March 31, 2012 and 2011 and the period from January 1, 2007 (Inception) to March 31, 2012 (Unaudited
Notes to Unaudited Financial Statements
Item 2 -Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3- Quantitative and Qualitative Disclosures about Market Risk
Item 4- Controls and Procedures
PART II - OTHER INFORMATION
Item 1- Legal Proceedings
Item 2- Unregistered Sales of Equity Securities and Use of Proceeds
Item 3- Defaults Upon Senior Securities
Item 4- Submission of Matters to a Vote of Security Holders
Item 5- Other Information
Item 6- Exhibits
SIGNATURES
CERTIFICATIONS
CATALYST RESOURCE GROUP, INC |
FORMERLY JEANTEX GROUP, INC |
(DEVELOPMENT STAGE COMPANY) |
CONSOLIDATED BALANCE SHEETS |
(unaudited) |
| | | | |
| | March 31, | | December 31, |
| | 2012 | | 2011 |
ASSETS: | | | | |
| | | | |
Current Assets: | | | | |
Cash | $ | (0) | $ | 0 |
| | | | |
TOTAL ASSETS | $ | (0) | $ | 0 |
| | | | |
LIABILITIES AND STOCKHOLDERS' DEFICIT: | | | | |
| | | | |
Current Liabilities: | | | | |
Accounts payable and accrued expense | $ | 204,417 | $ | 204,669 |
Interest payable | | 241,414 | | 281,649 |
Notes payable | | 275,000 | | 355,040 |
Convertible promissory note, net of discount $37,000 and $7,886 respectively | | 29,114 | | 82,011 |
Payables to related parties | | 118,103 | | 114,063 |
Derivative Liability | | 28,886 | | 173,944 |
Total Current Liabilities | $ | 896,934 | $ | 1,211,377 |
| | | | |
Stockholders' Deficit: | | | | |
Common stock, non-assessable, $0.001 par value, 999,990,000 shares authorized, 432,120,574 and 255,657,250 share sissued and outstanding, respectively | $ | 432,122 | $ | 255,659 |
Class B Common stock, assessable, $0.001 par value 10,000 shares authorized, 9,958 shares issued and outstanding | | 10 | | 10 |
Additional paid in capital | | 17,027,439 | | 16,839,161 |
Accumulated deficit prior to development stage | | (16,770,000) | | (16,770,000) |
Accumulated deficit during development stage | | (1,586,505) | | (1,536,206) |
Total Stockholders' Deficit | $ | (896,934) | $ | (1,211,377) |
| | | | |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ | 0 | $ | 0 |
| | | | |
| | | | |
The accompanying notes are an integral part of these financial statements. |
CATALYST RESOURCE GROUP, INC |
FORMERLY JEANTEX GROUP, INC |
(DEVELOPMENT STAGE COMPANY) |
CONSOLIDATED STATEMENTS OF OPERATIONS |
FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011 AND THE PERIOD |
FROM RE-ENTERING THE DEVELOPMENT STAGE, JANUARY 1, 2007, TO MARCH 31, 2011 |
(unaudited) |
| | | | | | | From Re-entering of |
| | | | | | | Development Stage |
| | | | | January 1, 2007 to |
| | | 2012 | | 2011 | | March 31, 2012 |
| | | | | | | |
NET SALES | | $ | - | $ | - | $ | - |
| | | | | | | |
COST OF GOODS SOLD | | | - | | - | | - |
| | | | | | | |
GROSS PROFIT | | | - | | - | | - |
| | | | | | | |
OPERATING EXPENSES: | | | | | | | |
General and administration | | | 5,202 | | 20,037 | | 421,031 |
Bad Debts | | | | | - | | 617,336 |
Total Operating Expenses | | | 5,202 | | 20,037 | | 1,038,367 |
| | | | | | | |
Income(Loss) from Operations | | | (5,202) | | (20,037) | | (1,038,367) |
| | | | | | | |
OTHER INCOME (EXPENSES) | | | | | | | |
Interest expense | | | (55,791) | | (39,745) | | (529,147) |
Change in fair value of derivative | | | 10,694 | | (3,516) | | (36,776) |
Other Income | | | - | | - | | 17,784 |
Total other income (expense) | | | (45,097) | | (43,261) | | (548,139) |
| | | | | | | |
NET INCOME(LOSS) | | $ | (50,299) | $ | (63,298) | $ | (1,586,506) |
| | | | | | | |
Weighted average number of Class A shares outstanding-basic and diluted | | | 344,325,603 | | 101,995,073 | | |
| | | | | | | |
Basic and diluted net loss per share-Class A | | $ | (0.00) | $ | (0.00) | | |
| | | | | | | |
The accompanying notes are an integral part of these financial statements. |
CATALYST RESOURCE GROUP, INC |
FORMERLY JEANTEX GROUP, INC |
(DEVELOPMENT STAGE COMPANY) |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011 |
AND THE PERIOD FROM RE-ENTERING THE DEVELOPMENT STAGE, JANUARY 1, 2007 TO MARCH 31, 2012 |
(unaudited) |
| | | | | | |
| | | | | | Period From |
| | | | | | January 1, 2007 |
| | | | | | (re-entering |
| | | | | | development stage) to |
| | 2012 | | 2011 | | March 31, 2012 |
Cash Flows From Operating Activities: | | | | | | |
Net loss | $ | (50,299) | $ | (63,298) | $ | (1,586,506) |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | |
Gain on Conversion Note | | | | - | | 617,336 |
Imputed interest charged to equity | | 966 | | 926 | | 15,857 |
Amortization of Discount | | 43,262 | | 25,239 | | 242,048 |
Issuance of shares for consulting services | | - | | | | 135,000 |
Changes in fair value of derivative liability | | (10,694) | | 3,516 | | 36,776 |
Changes in assets and liabilities: | | | | | | |
Decrease in deposits and prepaid expenses | | - | | - | | 46,816 |
Increase(decrease) in accounts payable | | (337) | | 8,588 | | (1,187) |
Increase in accrued expenses | | 14,603 | | 13,697 | | 218,009 |
Total adjustments | | 47,800 | | 51,966 | | 1,310,655 |
Net cash used in operating activities | | (2,500) | | (11,332) | | (275,851) |
| | | | | | |
| | | | | | |
Cash Flow From Financing Activities: | | | | | | |
Proceeds from notes - related parties | | 4,040 | | | | 150,500 |
Payment of Notes- related parties | | - | | (63,000) | | (189,126) |
Proceeds from notes | | - | | 80,000 | | 254,440 |
Payment on notes | | (1,540) | | | | (6,540) |
Payments of lines of credit | | - | | - | | (1,270) |
Stock issued for cash | | - | | - | | 62,600 |
Net cash provided by financing activities | | 2,500 | | 17,000 | | 270,604 |
| | | | | | |
Increase(decrease) in cash | | 0 | | 5,668 | | (5,247) |
Cash - Beginning of period | | - | | 180 | | 5,247 |
Cash - End of period | $ | 0 | $ | 5,848 | $ | 0 |
| | | | | | |
Supplemental Cash Flow Information: | | | | | | |
Interest paid | $ | - | $ | | $ | 19,177 |
Taxes paid | $ | - | $ | - | $ | - |
Non-cash investing and financing activities: | | | | | | |
Debt Discount | $ | 1,840 | | 44,090 | $ | 259,396 |
Relief of derivative liability due to conversion | $ | 98,000 | | 37,000 | $ | 185,000 |
| | | | | | |
The accompanying notes are an integral part of these financial statements. |
Catalyst Resource Group, Inc.
(Formerly Jeantex Group, Inc.)
Notes to Unaudited Consolidated Financial Statements
March 31, 2012
1. BASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS
Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to interim financial statements. Accordingly, they do not include all of the information and notes required for complete financial statements. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations and cash flows at March 31, 2012 and for all the periods presented have been made.
The financial information included in this quarterly report should be read in conjunction with the consolidated financial statements and related notes thereto in our Form 10-K for the year ended December 31, 2011.
The results of operations for the three months ended March 31, 2012 are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.
Development Stage Company
The Company has not earned significant revenue from planned principal operations since 2006. Accordingly, effective January 1, 2007, the Company's activities have been accounted for as those of a "Development Stage Enterprise" as set forth in FASB Pronouncements. Among the disclosures required are that the Company's financial statements be identified as those of a development stage company, and that the statements of operations, stockholders' equity (deficit) and cash flows disclose activity since the date of the Company's inception of development stage.
2. GOING CONCERN
The Company's consolidated financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has accumulated deficits of $18,356,056 at March 30, 2012. At March 31, 2012, the Company’s current liabilities exceeded its current assets by $896,934. In view of the matters described above, recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
3. NOTES PAYABLE
At March 30, 2012 and December 31, 2011, notes payable consisted of the following:
| | March 31, 2012 | | December 31, 2011 |
Note Payable to ex-president of the Company, unsecured, 8% interest matured September 2006 | $ |