Delaware
|
20-4378866
|
(State
or Other Jurisdiction of Incorporation
or
Organization)
|
(I.R.S.
Employer Identification No.)
|
1177
High Ridge Road, Stamford, CT
|
06905
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(203)
321-1285
|
|
(Issuer’s
Telephone Number, Including Area
Code)
|
PAGE
|
||
PART
I
|
FINANCIAL
INFORMATION
|
|
|
||
ITEM
1
|
Financial
Statements
|
1
|
|
||
ITEM
2
|
Management’s
Discussion and Analysis and Results of Operations
|
4
|
|
||
ITEM
3
|
Controls
and Procedures
|
11
|
|
||
PART
II
|
OTHER
INFORMATION
|
|
|
||
ITEM
1
|
Legal
Proceedings
|
12
|
|
||
ITEM
2
|
Unregistered
Sales of Equity Securities and Use of Proceeds.
|
12
|
|
||
ITEM
3
|
Defaults
Upon Senior Securities
|
12
|
|
||
ITEM
4
|
Submission
of Matters to a Vote of Security Holders.
|
12
|
|
||
ITEM
5
|
Other
Information
|
12
|
|
||
ITEM
6
|
Exhibits
|
12
|
|
||
SIGNATURES
|
15
|
|
|
||
CERTIFICATIONS
|
|
Balance
Sheet as of March 31, 2008 and June 30, 2007
|
F-1
|
|
|
Condensed
Statements of Operations for the Three Months and Nine Months Ended
March
31,
2008 and 2007, and for the Period December 15, 2005 (Inception) to
March
31, 2008
|
F-2
|
|
|
Condensed
Statements of Cash Flows for the Three Months and Nine Months Ended
March
31,
2008 and 2007, and for the Period December 15, 2005 (Inception) to
March
31, 2008
|
F-3
|
|
|
Notes
to Financial Statements
|
F-4
|
APRECIA,
INC.
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
CONDENSED
BALANCE SHEET
|
(Unaudited)
|
|||||||
March
31, 2008
|
June
30, 2007
|
||||||
ASSETS
|
|||||||
Current
Assets:
|
|||||||
Cash
and Cash Equivalents
|
$
|
832
|
$
|
60,624
|
|||
|
|||||||
Total
Current Assets
|
832
|
60,624
|
|||||
|
|||||||
Property
and Equipment, Net
|
1,192
|
1,908
|
|||||
|
|||||||
Deferred
Finance Costs, Net
|
-
|
93,812
|
|||||
|
|||||||
Total
Assets
|
$
|
2,024
|
$
|
156,344
|
|||
|
|||||||
|
|||||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
|
|||||||
Current
Liabilities:
|
|||||||
|
|||||||
7%
Convertible Debentures
|
$
|
500,000
|
$
|
500,000
|
|||
Convertible
Notes Payable, Net of Unamortized Discount of $-0- and
$37,654
|
201,960
|
164,306
|
|||||
Loan
Payable - Related Party
|
39,000
|
-
|
|||||
Accrued
Expenses
|
45,545
|
146,252
|
|||||
Accrued
Liquidated Damages
|
106,667
|
106,667
|
|||||
Accrued
Interest
|
126,077
|
62,737
|
|||||
Total
Current Liabilities
|
1,019,249
|
979,962
|
|||||
Commitments
and Contingencies
|
-
|
-
|
|||||
Stockholders'
Deficiency:
|
|||||||
Preferred
Stock, $.0001 par value; 10,000,000 shares authorized, none issued
and
outstanding
|
-
|
-
|
|||||
Common
Stock, $.0001 par value; 250,000,000 shares authorized, 16,761,597
issued
and outstanding
|
1,676
|
1,676
|
|||||
Additional
Paid-In Capital
|
288,821
|
153,822
|
|||||
Deferred
Finance Costs, Net
|
-
|
(6,026
|
)
|
||||
Deficit
Accumulated During the Development Stage
|
(1,307,722
|
)
|
(973,090
|
)
|
|||
Total
Stockholders' Deficiency
|
(1,017,225
|
)
|
(823,618
|
)
|
|||
Total
Liabilities and Stockholders' Deficiency
|
$
|
2,024
|
$
|
156,344
|
The
accompanying notes are an integral part of these financial
statements.
|
APRECIA,
INC.
|
(A
DEVELOPMENT STAGE COMPANY)
|
CONDENSED
STATEMENT OF OPERATIONS
|
(Unaudited)
|
For
the Nine Months Ended March 31, 2008
|
|
For
the Three Months Ended March 31, 2008
|
|
For
the Nine Months Ended March 31, 2007
|
|
For
the Three Months Ended March 31, 2007
|
|
For
the Period December 15, 2005 (Inception) to March 31, 2008
|
||||||||
Net
Revenues
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||
Costs
and Expenses:
|
||||||||||||||||
Officer's
Compensation
|
45,000
|
-
|
135,000
|
45,000
|
285,000
|
|||||||||||
Software
Development
|
42,000
|
-
|
124,553
|
42,553
|
256,985
|
|||||||||||
Other
General and Administrative Expenses
|
46,800
|
12,578
|
74,079
|
33,335
|
243,359
|
|||||||||||
Total
Costs and Expenses
|
133,800
|
12,578
|
333,632
|
120,888
|
785,344
|
|||||||||||
Loss
from Operations
|
(133,800
|
)
|
(12,578
|
)
|
(333,632
|
)
|
(120,888
|
)
|
(785,344
|
)
|
||||||
Other
Expenses:
|
||||||||||||||||
Amortization
of Deferred Finance Costs
|
(99,837
|
)
|
(17,986
|
)
|
-
|
-
|
(240,113
|
)
|
||||||||
Amortization
of Deferred Debt Discount
|
(37,654
|
)
|
-
|
-
|
-
|
(60,246
|
)
|
|||||||||
Interest
Expense
|
(63,341
|
)
|
(23,140
|
)
|
(103,275
|
)
|
(35,775
|
)
|
(126,077
|
)
|
||||||
Liquidated
Damages
|
-
|
-
|
(90,000
|
)
|
(30,000
|
)
|
(106,667
|
)
|
||||||||
Total
Other Expenses
|
(200,832
|
)
|
(41,126
|
)
|
(193,275
|
)
|
(65,775
|
)
|
(533,103
|
)
|
||||||
Net
Loss
|
$
|
(334,632
|
)
|
$
|
(53,704
|
)
|
$
|
(526,907
|
)
|
$
|
(186,663
|
)
|
$
|
(1,318,447
|
)
|
|
Weighted
Average Common Shares
|
||||||||||||||||
Outstanding
- Basic and Diluted
|
16,761,597
|
16,761,597
|
16,551,391
|
16,761,597
|
||||||||||||
Net
Loss Per Common Share - Basic and Diluted
|
$
|
(0.02
|
)
|
$
|
(0.00
|
)
|
$
|
(0.03
|
)
|
$
|
(0.01
|
)
|
The
accompanying notes are an integral part of these financial
statements.
|
APRECIA,
INC.
|
(A
DEVELOPMENT STAGE COMPANY)
|
CONDENSED
STATEMENT OF CASH FLOWS
|
(Unaudited)
|
|
|
For
the Nine Months Ended March 31, 2008
|
|
For
the Nine Months Ended March 31, 2007
|
|
For
the Period December 15, 2005 (Inception) to March
31,
2008
|
||||
Cash
Flows from Operating Activities:
|
||||||||||
Net
Loss
|
$
|
(334,632
|
)
|
$
|
(526,907
|
)
|
$
|
(1,307,722
|
)
|
|
Adjustments
to Reconcile Net Loss to Net Cash
|
||||||||||
(Used)
in Operating Activities:
|
||||||||||
Amortization
of Debt Discount
|
37,654
|
-
|
60,246
|
|||||||
Amortization
of Deferred Finance Costs
|
99,838
|
69,375
|
240,114
|
|||||||
Depreciation
Expense
|
716
|
716
|
1,670
|
|||||||
Common
Stock Issued for Software Development
|
-
|
970
|
||||||||
Changes
in Assets and Liabilities:
|
||||||||||
Increase
(Decrease) in Accrued Expenses
|
34,292
|
68,495
|
180,544
|
|||||||
Increase
in Accrued Interest
|
63,340
|
33,899
|
126,077
|
|||||||
Increase
in Liquidating Damages
|
-
|
90,000
|
106,667
|
|||||||
Net
Cash (Used) in Operating Activities
|
(98,792
|
)
|
(264,422
|
)
|
(591,434
|
)
|
||||
Cash
Flows from Investing Activities:
|
||||||||||
Purchase
of Equipment
|
-
|
(2,862
|
)
|
(2,862
|
)
|
|||||
Net
Cash (Used) in Investing Activities
|
-
|
(2,862
|
)
|
(2,862
|
)
|
|||||
Cash
Flows from Financing Activities:
|
||||||||||
Decrease
in Stock Subscription Receivable
|
-
|
-
|
451
|
|||||||
Proceeds
from Issuance of Convertible Debentures
|
-
|
-
|
500,000
|
|||||||
Proceeds
from Issuance of Notes Payable
|
-
|
-
|
170,000
|
|||||||
Proceeds
of Loan Payable - Related Party
|
39,000
|
-
|
39,000
|
|||||||
Proceeds
from Collection of Subscriptions Receivable
|
-
|
354
|
||||||||
Payments
of Finance Costs
|
-
|
-
|
(215,513
|
)
|
||||||
Proceeds
from Issuance of Common Stock
|
-
|
56,189
|
106,190
|
|||||||
Expense
of Sale of Common Stock
|
-
|
-
|
(5,000
|
)
|
||||||
Net
Cash Provided by Financial Activities
|
39,000
|
56,543
|
595,128
|
|||||||
Increase
(Decrease) in Cash
|
(59,792
|
)
|
(210,741
|
)
|
832
|
|||||
Cash
- Beginning of Period
|
60,624
|
224,279
|
-
|
|||||||
Cash
- End of Period
|
832
|
13,538
|
832
|
|||||||
Supplemental
Cash Flow Information:
|
||||||||||
Cash
Paid for Interest
|
||||||||||
Cash
paid for Income Taxes
|
$
|
250
|
||||||||
Supplemental
Non-Cash Financing Activities:
|
||||||||||
Subscription
Receivable on Sale of Common Stock
|
$
|
-
|
$
|
-
|
$
|
451
|
||||
|
||||||||||
Common
Stock Warrants Issued as Deferred Finance Costs
|
$
|
-
|
$
|
-
|
$
|
9,641
|
||||
Debt
Discount Attributable to Common Stock Warrants
|
||||||||||
on
Notes Payable
|
$
|
-
|
$
|
-
|
$
|
43,246
|
||||
Note
Payable Issued as Payment of Deferred Finance
Costs
|
$
|
-
|
$
|
-
|
$
|
14,960
|
The
accompanying notes are an integral part of these financial
statements.
|
· |
With
a price of less than $5.00 per
share;
|
· |
That
are not traded on a “recognized” national
exchange;
|
· |
Whose
prices are not quoted on a NASDAQ automated quotation system
(NASDAQ-listed stock must still have a price of not less than $5.00
per
share); or
|
· |
Stock
in issuers with net tangible assets less than $2,000,000 (if the
issuer
has been in continuous operation for at least three years) or $5,000,000
(if in continuous operation for less than three years), or with average
revenues of less than $6,000,000 for the last three
years.
|
a.
|
Exhibits
pursuant to Regulation S-K:
|
DESIGNATION
OF EXHIBIT AS SET FORTH IN ITEM 601 OF REGULATION
S-B
|
DESCRIPTION
|
LOCATION
|
||
3.1
|
Articles
of Incorporation
|
Incorporated
by Reference to the Registration Statement on Form SB-2 filed
on November
13, 2006 (File No. 333-138625).
|
||
3.2
|
Bylaws
|
Incorporated
by Reference to the Registration Statement on Form SB-2 filed
on November
13, 2006 (File No. 333-138625).
|
||
4.1
|
Securities
Purchase Agreement dated March 10, 2006 by and between the Company
and
Alpha Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna
Enterprises Corp., and CMS Capital
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.2
|
7%
Convertible Debenture dated March 10, 2006 issued to Alpha Capital
Aktiengesellschaft
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.3
|
Registration
Rights Agreement dated March 10, 2006 by and between the Company
and Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna
Enterprises
Corp., and CMS Capital
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.4
|
Security
Agreement dated March 10, 2006 by and between the Company and
Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna
Enterprises
Corp., and CMS Capital and Michael Hartstein, as collateral
agent
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.5
|
Collateral
Agent Agreement dated March 10, 2006 by and between the Company
and Alpha
Capital Aktiengesellschaft, Double U Master Fund LP, Tobanna
Enterprises
Corp., and CMS Capital and Michael Hartstein, as collateral
agent
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.6
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.7
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
4.8
|
7%
Convertible Debenture dated March 10, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
10.1
|
Asset
Purchase Agreement by and between Isidore Sobkowski and the Company
dated
March 6, 2006
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No. 333-138625).
|
||
10.2
|
Voting
Agreement by and between Michael Hartstein, Solomon Lax and Isidore
Sobkowski
|
Incorporated
by Reference to Amendment No. 1 to the Registration Statement
on Form SB-2
filed on December 27, 2006 (File No.
333-138625).
|
DESIGNATION
OF EXHIBIT AS SET FORTH IN ITEM 601 OF REGULATION
S-B
|
DESCRIPTION
|
LOCATION
|
||
10.3
|
Subscription
Agreement by and among the Company, Alpha
Capital Anstalt, and Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.4
|
Form
of Warrant issued by the Company to each of Alpha
Capital Anstalt, and Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.5
|
Form
of Secured Note issued by the Company to each of Alpha
Capital Anstalt and Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
10.6
|
Consent
Agreement by and among the Company, Alpha
Capital Anstalt, and Harborview Master Fund L.P.
|
Incorporated
by Reference to the Company’s Current Report of Form 8-K filed on May 30,
2007 (File No. 333-138625).
|
||
31.1
|
Certification
of President and Chief Executive Officer (one person) pursuant
to Rule
13a-14(a)/15d-14(a) of the Exchange Act
|
Provided
Herewith
|
||
32.1
|
Certification
of President and Chief Executive Officer (one person) pursuant
to 18
U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
Provided
Herewith
|
APRECIA,
INC.
|
||
|
|
|
May
14, 2008
|
By: | /s/ Isidore Sobkowski |
Isidore
Sobkowski, President, Chief Executive
Officer
and Interim Chief Financial Officer
|
||