Item 1. Description of Business.
This annual report contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
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. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our consolidated financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.
In this annual report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references "common shares" refer to the common shares in our capital stock.
As used in this annual report, the terms "we", "us", "our", and "Jetblack" mean Jetblack Corp., unless otherwise indicated.
Our Business - General
We were incorporated on April 17, 2002, under the laws of the State of Nevada. We have commenced limited operations, and have generated revenue of $7,569 to date. We are still a development stage corporation. On January 30, 2007, we approved a nine (9) for one (1) forward stock split of our authorized, issued and outstanding shares of common stock. The Company amended its Articles of Incorporation by the filing of a Certificate of Change with the Nevada Secretary of State wherein it stated that it would issue nine shares for every one share of common stock issued and outstanding immediately prior to the effective date of the forward stock split. The change in the Articles of Incorporation was effected with the Nevada Secretary of State on March 1, 2007. As a result, the authorized capital of our company increased from 25,000,000 to 225,000,000 shares of common stock with a par value of $0.001.
Effective March 15, 2010, the Company changed its name from Tortuga Mexican Imports Inc. to Jetblack Corp., by way of a merger with the Company’s wholly owned subsidiary Jetblack Corp., which was formed solely for the change of name.
Effective March 15, 2010, the Company effected a six (6) for one (1) new forward stock split of the Company’s authorized and issued and outstanding common stock. As a result, the Company’s authorized capital increased from 225,000,000 to 1,350,000,000 shares, and outstanding shares increased from 25,435,450 shares of common stock to 152,612,700 shares of common stock, all with a par value of $0.001. The stock split is presented retroactively in these financial statements.
On May 4, 2011, Nigel Farnsworth returned 86,327,600 of his common shares to treasury. As of December 14, 2011, there are 67,113,000 common shares of the Company issued and outstanding.
Until March 15, 2010 we had launched our e-commerce site on the Internet for the purpose of engaging in the business of selling jewelry and crafts online. Our website was located at www.shoptortuga.com. Our initial website was located at www.tortuga-imports.com.
After reviewing the competitive market place of jewelry and giving consideration to the influx of much cheaper jewelry goods from areas such as China and Indonesia, management decided it was in the best interest of the Company to change business focus. Management has decided to commence work on developing an online reservation system to access numerous private jet aircraft, airports worldwide and a network of pre-approved, safety-checked operators. Management believes a strong market opportunity exists to develop such a business. Our name was changed to Jetblack Corp. to better reflect this change of business focus.
Properties
Our offices are located at Suite 219-10654 82nd Avenue NW, Edmonton, Alberta T6E 2A7. We conduct all of our executive and administrative functions and ship our products to our customers from this facility. Our office space is an office sharing arrangement being provided as an accommodation to us by a business associate of our former President, Ms. Avila. We are currently searching for new lease office and warehouse space. We will require a location that provides us with the space necessary for office administration. We anticipate locating a suitable facility in the near future. Our telephone number is (780) 710-9840.
History
From 1995 to 1997, Ms. Avila, our former President and director, traveled extensively throughout the country of Mexico. During this time, Ms. Avila came in contact with various producers of fine furniture, jewelry and Mexican crafts. Ms. Avila was impressed by the opportunity she saw to obtain exceptional Mexican furniture, jewelry and crafts and effect its reliable delivery to international buyers. Initially Ms. Avila was traveling throughout Mexico in pursuit of personal purchases. However, Ms. Avila soon realized that there was an opportunity to export these fine products abroad. Ms. Avila cultivated relationships and contacts with various producers throughout Mexico.
We raised a total of $68,450 pursuant to our SB-2 registration statement, which was declared effective on February 22, 2005. We closed the offering on August 22, 2005. In October 2007, the Company received $15,000 for subscriptions for 450,000 shares of the Company’s common stock. In November 2008, the Company received $15,000 for subscriptions of 450,000 shares. These shares were issued in December 2010.
On December 10, 2009, the Company issued 1,500,000 common shares for a subscription of $25,000. As of August 31, 2011, $12,178 was paid for the subscription and the remaining $12,822 was recorded as a subscription receivable.
During December 2010, the Company issued 227,900 common shares at $0.05 per share for gross proceeds of $11,395.
During February 2011, the Company received $6,950 in gross proceeds for 139,000 common shares subscribed at $0.05 per share. These shares have not been issued.
Management did not purchase shares in either transaction.
On May 2, 2011, Nigel Farnsworth purchased 108,000,000 shares of common stock of the Company from Vanessa Avila in a private, non-issuer transaction resulting in a change in control of Jetblack.
On May 3, 2011, Vanessa Avila resigned as President, Secretary and Director of the Company. Effective May 3, 2011, Nigel Farnsworth was elected Director and appointed President, Secretary and Treasurer of the Company.
We remain a development stage enterprise.
Current Business Operations
We have recently changed operations. We intend to develop an online reservation system to access to numerous private jet aircraft, airports worldwide and a network of pre-approved, safety-checked operators. We intend to develop a booking engine, which will provide real-time availability of small jets available for charter in certain areas and select the best option from the inventory of aircraft.
Products
For the period ended August 31, 2011 we did not have a product line. We are currently developing a booking engine, which will provide real-time availability of small jets available for charter in certain areas and select the best option from the inventory of aircraft.
Marketing, Advertising and Promotion
We intend to pursue strategic advertising and marketing campaigns. We intend to implement an aggressive online advertising and marketing campaign to increase awareness of our new name and business plan to acquire new customers through multiple channels, including traditional and online advertising, direct marketing and expansion and strengthening of strategic relationships. Initially, we will concentrate our efforts on the sale of private jet flight reservations on our e-commerce website which we have yet to complete. We will seek to promote its website and attract visitors to it by becoming predominant on major search engines and banner advertisements on highly trafficked web sites that appeal to our target audience. In addition, we will promote our website and our products by conventional advertising and marketing.
Product Research and Development
We anticipate that we will expend approximately $20,000 on research and development over the twelve months ending August 31, 2012.
Employees
Currently there are no full time or part-time employees of our company. However, our president, Nigel Fransworth, is a consultant of our company. We do not expect an increase in the number of employees over the next 12 month period. If business is successful and we experience rapid growth, our current officers and directors may be required to hire new personnel to improve, implement and administer our operational, management, financial and accounting systems.
Purchase or Sale of Equipment
In addition to purchasing computer and office equipment necessary for operating our business, intend to purchase computer software to develop a booking engine, which will provide real-time availability of small jets available for charter in certain areas and select the best option from the inventory of aircraft. We also intend to purchase a new domain over the twelve months ending August 31, 2012.
RISK FACTORS
Much of the information included in this quarterly report includes or is based upon estimates, projections or other "forward-looking statements". Such forward-looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions, or other future performance suggested herein. We undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of such statements.
Such estimates, projections or other "forward-looking statements" involve various risks and uncertainties as outlined below. We caution readers of this quarterly report that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward-looking statements". In evaluating us, our business and any investment in our business, readers should carefully consider the following factors.
We may not be able to obtain the financing and capital required to maintain and grow our business.
We have incurred a net loss of $19,619 for the year ended August 31, 2011. As of August 31, 2011, we had an accumulated deficit of $155,918. There can be no assurance that we will generate significant revenues or achieve profitable operations. Our independent registered public accounting firm’s report on the August 31, 2011 financial statements included in this Form 10-K includes an explanatory paragraph that raises substantial doubt about our ability to continue as a going concern as our ability to continue our business is dependent upon our ability to obtain additional capital, among other things.
We are in the early stages of our growth and we have not earned significant revenue, which makes it difficult to evaluate whether we will operate profitably.
We are in the early stages of the growth of our company. As a result, we do not have a meaningful historical record of sales and revenues nor an established business track record. We have only recently begun to earn revenues.
Unanticipated problems, expenses and delays are frequently encountered in ramping up production and sales and developing new products, especially in the current stage of our business. Our ability to continue to successfully develop, produce and sell our products and to generate significant operating revenues will depend on our ability to, among other things:
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successfully market, distribute and sell our products or enter into agreements with third parties to perform these functions on our behalf.
Given our limited operating history, lack of long-term sales history and other sources of revenue, there can be no assurance that we will be able to achieve any of these goals and develop a sufficiently large customer base to be profitable.
The future of our company will depend upon our ability to continue to obtain adequate orders for our products and prompt payment for our products. To the extent that we cannot achieve our plans and generate revenues which exceed expenses on a consistent basis and in a timely manner, our business, results of operations, financial condition and prospects could be materially adversely affected.
We will depend on third party providers to deliver our products in a timely manner and as such we are subject to delays which are out of our control and may lead to a loss of business.
Our product distribution will rely on third-party aircraft providers. Lack of availability and other interruptions may delay the timely delivery of customer orders, and customers may refuse to purchase our products because of this loss of convenience.
Because our director has a foreign addresses this may create potential difficulties relating to service of process in the event that you wish to serve her with legal documents.
Our current director and officer is not resident addresses in the United States. Because our officer and director has foreign addresses this may create potential difficulties relating to the service of legal or other documents on any of them in the event that you wish to serve them with legal documents. This is because the laws related to service of process may differ between Canada and the US. Similar difficulties could not be encountered in serving the company, proper, since our registered address is located in the United States at 880 - 50 West Liberty Street, Reno, Nevada, 89501.
Because the SEC imposes additional sales practice requirements on brokers who deal in our shares which are penny stocks, some brokers may be unwilling to trade them. This means that you may have difficulty in reselling your shares and may cause the price of the shares to decline.
Our shares qualify as penny stocks and are covered by Section 15(g) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell our securities in this offering or in the aftermarket. For sales of our securities, the broker/dealer must make a special suitability determination and receive from you a written agreement prior to making a sale to you. Because of the imposition of the foregoing additional sales practices, it is possible that brokers will not want to make a market in our shares. This could prevent you from reselling your shares and may cause the price of the shares to decline.
We need to continue as a going concern if our business is to succeed, if we do not we will go out of business.
Our independent accountant's report to our audited financial statements for the year ended August 31, 2011 indicates that there are a number of factors that raise substantial doubt about our ability to continue as a going concern. Such factors identified in the report are our accumulated deficit since inception, our failure to attain profitable operations and our dependence upon adequate financing to pay our liabilities. If we are not able to continue as a going concern, it is likely investors will lose their investments.
The loss of Mr. Farnsworth or other key management personnel would have an adverse impact on our future development and could impair our ability to succeed.
Our performance is substantially dependent upon the expertise of our President, Mr. Nigel Farnsworth, and other key management personnel, and our ability to continue to hire and retain personnel. Mr. Farnsworth spends the majority of his working time working with our company. It may be difficult to find sufficiently qualified individuals to replace Mr. Farnsworth or other key management personnel if we were to lose any one or more of them. The loss of Mr. Farnsworth or any of our key management personnel could have a material adverse effect on our business, development, financial condition, and operating results.
We do not maintain “key person” life insurance on any of our directors or senior executive officers.
We do not expect to declare or pay any dividends.
We have not declared or paid any dividends on our common stock since our inception, and we do not anticipate paying any such dividends for the foreseeable future.
Item 2.
Item 2. Description of Property.
Our administrative office is located at Suite 219-10654 82nd Avenue NW, Edmonton, Alberta, T6E 2A7 and our telephone number is (780) 710-9840.
Item 3.
Item 3. Legal Proceedings.
We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder are an adverse party or has a material interest adverse to us.
Item 4.
Item 4. Submissions of Matters to a Vote of Security Holders.
None.
PART II
Item 5.
Item 5. Market for Common Equity and Related Stockholder Matters.
As of December 12, 2011 there were 63 holders of record of our common stock. As of such date, 67,113,000 common shares were issued and outstanding. Our common stock is quoted on the Over-the-Counter Bulletin Board under the symbol “JTBK”.
On January 30, 2007, our Board of Directors approved a nine (9) for one (1) forward stock split of our authorized, issued and outstanding shares of common stock. We amended our Articles of Incorporation by the filing of a Certificate of Change with the Nevada Secretary of State wherein we stated that our Corporation will issue nine (9) shares for every one (1) share of common stock issued and outstanding immediately prior to the effective date of the forward stock split. The change in our Articles of Incorporation was effected with the Nevada Secretary of State on March 1, 2007. As a result, our authorized capital has increased from 25,000,000 to 225,000,000 shares of common stock with a par value of $0.001 each.
Effective March 15, 2010, the Company changed its name from Tortuga Mexican Imports Inc. to Jetblack Corp., by way of a merger with the Company’s wholly owned subsidiary Jetblack Corp., which was formed solely for the change of name.
Effective March 15, 2010, the Company effected a six (6) for one (1) new forward stock split of the Company’s authorized and issued and outstanding common stock. As a result, the Company’s authorized capital increased from 225,000,000 to 1,350,000,000 shares, and outstanding shares increased from 25,435,450 shares of common stock to 152,612,700 shares of common stock, all with a par value of $0.001. The stock split is presented retroactively in these financial statements.
On May 4, 2011, Nigel Farnsworth returned 86,327,600 of his common shares to treasury. As of December 14, 2011, the total number of issued and outstanding shares of the Company was 67,113,000.
Empire Stock Transfer, Las Vegas, Nevada 89128-8380 (Telephone: 702-988-1242; Facsimile: 702-988-1244) is the registrar and transfer agent for our common shares.
There are no outstanding options or warrants to purchase, or securities convertible into, our common shares. We have not declared any dividends since incorporation and do not anticipate that we will do so in the foreseeable future. Although there are no restrictions that limit the ability to pay dividends on our common shares, our intention is to retain future earnings for use in our operations and the expansion of our business.
Recent Sales of Unregistered Securities
During February 2011, the Company received $6,950 in gross proceeds for 139,000 common shares subscribed at $0.05 per share. These shares have not been issued.
On November 24, 2011, the Company received $30,000 from subscriptions for 150,000 common shares at $0.20 per share. The shares were issued on December 7, 2011.
Item 6.
Item 6. Selected Financial Data.
Not required.
Item 7.
Item 7. Management Discussion and Analysis and Plan of Operation.
Results of Operations.
For the year ending August 31, 2011 we posted losses of $19,619 as compared to losses of $15,626 for the year ended August 31, 2010. Inception through August 31, 2011 losses totaled $155,918. General and administrative expenses are the principal component of our losses since inception.
Financial Condition, Liquidity and Capital Resources
At August 31, 2011, we had cash of $nil as compared to $0 for the year ended August 31, 2010.
At August 31, 2011 our total assets were $nil as compared to $0 for the year ended August 31, 2010.
As of August 31, 2011, our total liabilities were $24,290 comprised primarily of accounts payable and accrued expenses. This compares to our total liabilities of $23,016 at August 31, 2010.
Cash Requirements
Over the next twelve months we intend to raise funds for general and administrative expenditures, as follows:
Estimated Funding Required During the Next Twelve Months
We will require additional financing before we generate significant revenues. We intend to raise the capital required to meet any additional needs through sales of our securities in secondary offerings or private placements. We have no agreements in place to do this at this time. We raised a total of $68,450 pursuant to our SB-2 registration statement, which was declared effective on February 22, 2005. We closed the offering on August 22, 2005. In October 2007, the Company received $15,000 for subscriptions for 450,000 shares of the Company’s common stock. In November 2008, the Company received $15,000 for subscriptions of 450,000 shares. These shares were issued in December 2010.
On December 10, 2009, the Company issued 1,500,000 common shares for a subscription of $25,000. As of August 31, 2011, $12,178 was paid for the subscription and the remaining $12,822 was recorded as a subscription receivable.
During December 2010, the Company issued 227,900 common shares at $0.05 per share for gross proceeds of $11,395.
During February 2011, the Company received $6,950 in gross proceeds for 139,000 common shares subscribed at $0.05 per share. These shares have not been issued.
Management did not purchase shares in either transaction.
We have recently changed operations. We intend to develop an online reservation system to access to numerous private jet aircraft, airports worldwide and a network of pre-approved, safety-checked operators. We intend to develop a booking engine, which will provide real-time availability of small jets available for charter in certain areas and select the best option from the inventory of aircraft.
There are no assurances that we will be able to obtain additional funds required for our continued operations. In such event that we do not raise sufficient additional funds by secondary offering or private placement, we will consider alternative financing options, if any, or be forced to scale down or perhaps even cease our operations.
Recently Issued Accounting Standards
The adoption of recently issued pronouncements is not expected to have a material effect on our financial position or results of operation.
APPLICATION OF CRITICAL ACCOUNTING POLICIES
Our consolidated financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financials.
Item 8.
Item 8. Financial Statements.
Our consolidated financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.
LBB & ASSOCIATES LTD., LLP
10260 Westheimer Road, Suite 310
Houston, TX 77042
Phone: (713) 800-4343 Fax: (713) 456-2408
Report of Independent Registered Public Accounting Firm
To the Board of Directors of
Jetblack Corp.
(A Development Stage Company)
Edmonton, Alberta Canada
We have audited the accompanying consolidated balance sheets of Jetblack Corp. (the “Company”) as of August 31, 2011 and 2010, and the related consolidated statements of operations, stockholders' equity (deficit), and cash flows for each of the years then ended and for the period from April 17, 2002 (inception) through August 31, 2011. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit 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 also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Jetblack Corp. as of August 31, 2011 and 2010, and the results of its operations and its cash flows for each of the years then ended and for the period from April 17, 2002 (inception) through August 31, 2011, in conformity with accounting principles generally accepted in the United States of America.
As discussed in Note 1 to the consolidated financial statements, the Company's absence of significant revenues, recurring losses from operations, and its need for additional financing in order to fund its projected loss in 2012 raise substantial doubt about its ability to continue as a going concern. The 2011 consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ LBB & Associates Ltd., LLP
LBB & Associates Ltd., LLP
Houston, Texas
December 7, 2011
JETBLACK CORP.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
See accompanying notes to consolidated financial statements.
JETBLACK CORP.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended August 31, 2011 and 2010 and
the Period from April 17, 2002 (Inception) through August 31, 2011
See accompanying notes to the consolidated financial statements.
JETBLACK CORP.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
For the Period From April 17, 2002 (Inception) through August 31, 2011
See accompanying notes to the consolidated financial statements.
JETBLACK CORP.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended August 31, 2011 and 2010 and
Period from April 17, 2002 (Inception) through August 31, 2011
See accompanying notes to the consolidated financial statements.
JETBLACK CORP.
(A DEVELOPMENT STAGE COMPANY)
Notes to the Consolidated Financial Statements
NOTE 1 - NATURE OF BUSINESS
Jetblack Corp. (the “Company") was incorporated under the name Tortuga Mexican Imports in Nevada on April 17, 2002, to sell jewellery, furniture and other Mexican handcrafted products. On June 1, 2006 the Company acquired Tortuga Mexican Imports Canada Inc. ("Tortuga Canada"), a Canadian private company incorporated under the federal laws of Canada. Effective March 15, 2010, the Company changed its name from Tortuga Mexican Imports Inc. to Jetblack Corp., by way of a merger with the Company’s wholly owned subsidiary Jetblack Corp., which was formed solely for the change of name.
Going concern
These financial statements have been prepared in accordance with United States generally accepted accounting principles, on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As at August 31, 2011, the Company has working capital deficit of $24,290 and has incurred losses since inception of $155,918. Further losses are anticipated in the development of its business and there can be no assurance that the Company will be able to achieve or maintain profitability. These factors raise substantial doubt about its ability to continue as a going concern.
The continuing operations of the Company and the recoverability of the carrying value of assets is dependent upon the ability of the Company to obtain necessary financing to fund its working capital requirements, and upon future profitable operations. The accompanying financial statements do not include any adjustments relative to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result from the outcome of this uncertainty.
There can be no assurance that capital will be available as necessary to meet the Company's working capital requirements or, if the capital is available, that it will be on terms acceptable to the Company. The issuances of additional equity securities by the Company may result in dilution in the equity interests of its current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase the Company's liabilities and future cash commitments. If the Company is unable to obtain financing in the amounts and on terms deemed acceptable, the business and future success may be adversely affected.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All significant inter-company transactions and balances have been eliminated.
Cash and Cash Equivalents
Cash and cash equivalents are defined as cash on hand, demand deposits and short-term, highly liquid investments with an original maturity of ninety days or less.
Development Stage Company
The Company complies with Accounting Standards Board Codification 915 for its characterization of the Company as development stage.
Use of Estimates
The preparation of financial statements in conformity generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the period. Actual results may differ from those estimates.
Basic Loss per Share
Basic loss per share has been calculated based on the weighted average number of shares of common stock outstanding during the period.
Income Taxes
The asset and liability approach is used to account for income taxes by recognizing deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. The Company records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized.
Financial Instruments
The Company's financial instruments consist of cash, accounts payable and advances from shareholders. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. Because of the short maturity of such assets and liabilities the fair value of these financial instruments approximate their carrying values, unless otherwise noted.
Inventory
Inventories are valued at the lower of cost or market. Cost is determined by using the average cost method. Inventories consist primarily of Mexican jewelry and silverware. Tortuga determines its provision for obsolete and slow-moving inventory based on management's analysis of inventory levels and future sales forecasts.
Impairment of Inventory
The Company reviews inventory for indicators of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the review indicates that the carrying amount of the asset may not be recoverable, the potential impairment is measured based on a projected discounted cash flow method using a discount rate that is considered to be commensurate with the risk inherent in the company's current business model. During the years ended August 31, 2011 and 2010, the Company recorded no impairment loss.
Revenue Recognition
The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is probable. These criteria are generally met at the time product is shipped or services are performed.
All sales are final and returns are not accepted. All sales are paid in cash at the time the products are delivered.
Recent Accounting Pronouncements
We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.
NOTE 3 - SHAREHOLDER ADVANCE
During the year ended August 31, 2009 Ms. Avila, our former President and former majority shareholder, advanced $4,000 to the Company. There is no written loan agreement. Interest is accrued on these advances at the rate of 10% per annum. As at August 31, 2011 the interest accrued on the advances is $1,162. The advances and accrued interest are payable on demand and unsecured.
During the year ended August 31, 2011, Mr. Farnsworth, our President and majority shareholder, advanced $910 to the Company. There is no written loan agreement. The loan is interest free and is payable on demand and unsecured.
NOTE 4 - COMMON STOCK
During the year ended August 31, 2009, the Company subscribed 450,000 shares for cash proceeds of $15,000. The shares were issued in December 2010.
During the year ended August 31, 2010, the Company issued 1,500,000 common shares for a subscription of $25,000. As at August 31, 2010, $12,178 was paid for the subscription and the remaining $12,822 is recorded as a subscription receivable.
During the year ended August 31, 2011, the Company issued 227,900 common shares at $0.05 per share for gross proceeds of $11,395.
During the year ended August 31, 2011, the Company received $6,950 in gross proceeds for 139,000 common shares subscribed at $0.05 per share. These shares have not been issued.
On May 2, 2011, the new director and president of the Company purchased 108,000,000 shares of the Company’s common stock from the prior director and president of the Company in a private, non-issuer transaction. As at May 2, 2011, the purchased shares represented approximately 70% of the Company’s issued and outstanding common stock.
On May 4, 2011, the new director and president of the Company returned 86,327,600 shares of the Company’s common stock to treasury, as a result of which he owns 21,672,400 common shares of the Company representing approximately 32% of the Company’s issued and outstanding shares of common stock.
NOTE 5 - INCOME TAXES
Deferred income taxes reflect the net effect of (a) temporary difference between carrying amounts of assets and liabilities for financial purposes and the amounts used for income tax reporting purposes, and (b) net operating loss carryforwards. No net provision for refundable Federal income tax has been made in the accompanying statement of loss because no recoverable taxes were paid previously. Similarly, no deferred tax asset attributable to the net operating loss carryforward has been recognized, as it is not deemed likely to be realized.
The provision for refundable Federal income tax consists of the following:
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:
At August 31, 2011, the Company had an unused net operating loss carryover approximating $155,000 that is available to offset future taxable income, which expires beginning in 2022.
NOTE 6 - SUBSEQUENT EVENT
On November 24, 2011, the Company received $30,000 from subscriptions for 150,000 common shares at $0.20 per share. The shares were issued on December 7, 2011.
Item 9.
Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.
None
Item 9A.
Item 9A. Controls and Procedures.
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Our management does not expect that our disclosure controls or our internal controls over financial reporting will prevent all error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, but not absolute, assurance that the objectives of a control system are met. Further, any control system reflects limitations on resources and the benefits of a control system must be considered relative to its costs. These limitations also include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of a control. A design of a control system is also based upon certain assumptions about potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.
As of August 31, 2011, the year end period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our Chief Executive Officer/Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this annual report. There have been no changes in our internal controls over financial reporting that occurred during the fiscal year ended August 31, 2011 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.
Management's Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Management has employed a framework consistent with Exchange Act Rule 13a-15(c), to evaluate internal control over financial reporting described below. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation and fair presentation of financial statements for external purposes in accordance with generally accepted accounting principals
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management conducted an evaluation of the design and operation of our internal control over financial reporting as of and for the year ended August 31, 2011. In making this assessment, Management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. As a result of this assessment, our Chief Executive Officer/Chief Financial Officer concluded that, as of and for the year ended August 31, 2011, our internal control over financial reporting was effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles as of the year and quarter ended August 31, 2011.
This annual report does not include an attestation report of the company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management's report in this annual report.
Item 9B.
Item 9B. Other Information
None.
PART III
Item 10.
Item 10.
Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act.
Directors and Executive Officers, Promoters and Control Persons
Our directors, executive officers and other significant employees, their ages, positions held and duration each person has held that position, are as follows:
Business Experience
The following is a brief account of the education and business experience of each director, executive officer and key employee during at least the past five years, indicating each person's principal occupation during the period, and the name and principal business of the organization by which he or she was employed.
Nigel Farnsworth, President, Secretary and Director
Mr. Farnsworth is a graduate of The School of Business at The University of Exeter in Exeter, United Kingdom and has been involved with numerous business ventures in the both the United Kingdom and the United States. From 2005 to the present Mr. Farnsworth has been a principal at Greenshoe Capital LLC.
Vanessa Avila, President, Secretary and Director
From April 17, 2002 to May 3, 2011, Ms. Avila was our president, secretary and a member of our board of directors. Ms. Avila completed a Masters degree in Linguistics at the University of Alberta in 2005. From 2001 through to the summer of 2004, Ms. Avila was a Spanish instructor at the University of Alberta in Edmonton, Canada teaching entry-level full credit Spanish courses and upper level advanced courses. From 1997 to 2001 Ms. Avila was attending the University of Alberta on a full time basis. Ms. Avila graduated from the University of Alberta with a Bachelors degree in Linguistics in June 2001.
Involvement in Certain Legal Proceedings
Our directors, executive officers and control persons have not been involved in any of the following events during the past five years:
1. any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
2. any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
3. being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
4. being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.
Audit Committee Financial Expert
Our board of directors has determined that we do not have an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K under the Exchange Act.
We believe that the members of our board of directors are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. We believe that retaining an independent director who would qualify as an “audit committee financial expert” would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact that we have not generated any material revenues to date. In addition, we currently do not have an audit committee or committee performing similar functions nor do we have a written audit committee charter. Our board of directors does not believe that it is necessary to have such committees because it believes the functions of such committee can be adequately performed by our board of directors.
Code of Ethics
Effective October 30, 2005, our company's board of directors adopted a Code of Business Conduct and Ethics that applies to, among other persons, our company's president (being our principal executive officer) and our company's secretary (being our principal financial and accounting officer and controller), as well as persons performing similar functions. As adopted, our Code of Business Conduct and Ethics sets forth written standards that are designed to deter wrongdoing and to promote:
(1) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
(2) full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submit to, the Securities and Exchange Commission and in other public communications made by us;
(3) compliance with applicable governmental laws, rules and regulations;
(4) the prompt internal reporting of violations of the Code of Business Conduct and Ethics to an appropriate person or persons identified in the Code of Business Conduct and Ethics; and
(5) accountability for adherence to the Code of Business Conduct and Ethics.
Our Code of Business Conduct and Ethics requires, among other things, that all of our company's personnel shall be accorded full access to our president and secretary with respect to any matter which may arise relating to the Code of Business Conduct and Ethics. Further, all of our company's personnel are to be accorded full access to our company's board of directors if any such matter involves an alleged breach of the Code of Business Conduct and Ethics by our president or secretary.
In addition, our Code of Business Conduct and Ethics emphasizes that all employees, and particularly managers and/or supervisors, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal, provincial and state securities laws. Any employee who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to his or her immediate supervisor or to our company's president or secretary. If the incident involves an alleged breach of the Code of Business Conduct and Ethics by the president or secretary, the incident must be reported to any member of our board of directors. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our company's Code of Business Conduct and Ethics by another.
We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to: Jetblack Corp., Suite 219 - 10654 82nd Ave, Edmonton, Alberta, Canada T6E 2A7.
Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors and persons who own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common stock and other equity securities, on Forms 3, 4 and 5 respectively. Executive officers, directors and greater than 10% shareholders are required by the Securities and Exchange Commission regulations to furnish us with copies of all Section 16(a) reports they file.
To the best of our knowledge, all executive officers, directors and greater than 10% shareholders filed the required reports in a timely manner.
Item 11.
Item 11. Executive Compensation.
Vanessa Avila received nil in cash or other compensation during the fiscal years ended August 31, 2011 and nil during the fiscal years ended August 31, 2010. Mr. Farnsworth received nil in cash or other compensation for the year ended August 31, 2011.
There were no grants of stock options or stock appreciation rights made during the fiscal years ended August 31, 2011 and 2010 to our executive officers and directors. There were no stock options outstanding as at August 31, 2011. To date, we have not granted stock options or stock appreciation rights to any of our employees, consultants, directors or executive officers.
We intend to continue to pay consulting fees to our directors and officers in the future as we determine necessary. In addition, we intend to compensate our directors in the future with stock options to purchase common shares as awarded by our board of directors or (as to future stock options) a compensation committee which may be established. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. Our board of directors may also award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director. No director received and/or accrued any compensation for their services as a director, including committee participation and/or special assignments.
There are no formal management agreements with our directors or executive officers.
We have no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation exceeds $60,000 per executive officer.
There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the Board of Directors or a committee thereof.
Item 12.
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
Beneficial Ownership
The following table sets forth, as of December 14, 2011, certain information with respect to the beneficial ownership of our common shares by each shareholder known to us to be the beneficial owner of 5% of our common shares, and by each of our officers and directors. Each person has sole voting and investment power with respect to the common shares, except as otherwise indicated. Beneficial ownership consists of a direct interest in the common shares, except as otherwise indicated.
(1) Based on 67,113,000 shares outstanding as of December 14, 2011 and, as to a specific person, shares issuable pursuant to the conversion or exercise, as the case may be, of currently exercisable or convertible debentures, share purchase warrants and stock options.
Changes in Control
We are unaware of any contract or other arrangement the operation of which may at a subsequent date result in a change in control of our company.
Item 13.
Item 13. Certain Relationships and Related Transactions.
None.
Item 14.
Item 14. Principal Accountant Fees and Services
Audit Fees
The aggregate fees billed by LBB & Associates Ltd., LLP for professional services rendered for the audit of our annual financial statements included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2011 were $6,500.
Audit Related Fees
For the fiscal year ended August 31, 2011, the aggregate fees billed for assurance and related services by LBB & Associates Ltd., LLP relating to the performance of the audit of our financial statements which are not reported under the caption "Audit Fees" above, was $7,060.
Tax Fees
For the fiscal year ended August 31, 2011, the aggregate fees billed by LBB & Associates Ltd., LLP for other non-audit professional services, other than those services listed above, totalled $0.
We do not use LBB & Associates Ltd., LLP for financial information system design and implementation. These services, which include designing or implementing a system that aggregates source data underlying the financial statements or generates information that is significant to our financial statements, are provided internally or by other service providers. We do not engage LBB & Associates Ltd., LLP to provide compliance outsourcing services.
Effective May 6, 2003, the Securities and Exchange Commission adopted rules that require that before LBB & Associates Ltd., LLP is engaged by us to render any auditing or permitted non-audit related service, the engagement be:
·
approved by our audit committee (which consists of entire Board of Directors); or
·
entered into pursuant to pre-approval policies and procedures established by the audit committee, provided the policies and procedures are detailed as to the particular service, the audit committee is informed of each service, and such policies and procedures do not include delegation of the audit committee's responsibilities to management.
The audit committee pre-approves all services provided by our independent auditors. The pre-approval process has just been implemented in response to the new rules, and therefore, the audit committee does not have records of what percentage of the above fees were pre-approved. However, all of the above services and fees were reviewed and approved by the audit committee either before or after the respective services were rendered.
The audit committee has considered the nature and amount of fees billed by LBB & Associates Ltd., LLP and believes that the provision of services for activities unrelated to the audit is compatible with maintaining LBB & Associates Ltd., LLP's independence.
Item 15.
Item 15. Exhibits.
Exhibits required by Item 601 of Regulation S-B
(3) Articles of Incorporation and By-laws
3.1 Articles of Incorporation (incorporated by reference from our Registration Statement on Form SB-2, filed on February 4, 2003).
3.2 Bylaws (incorporated by reference from our Registration Statement on Form SB-2, filed on February 4, 2003).
(31) Section 302 Certification
31.1 Certifications of Nigel Farnsworth
(32) Section 906 Certification
32.1 Certification of Nigel Farnsworth
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
JETBLACK CORP.
Date: December 14, 2011
By:
/s/ Nigel Farnsworth
Nigel Farnsworth,
President, Treasurer, Chief Executive Officer,
Chief Financial Officer and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Date: December 14, 2011
By:
/s/ Nigel Farnsworth
Nigel Farnsworth,
President, Treasurer, Chief Executive Officer, Chief Financial Officer and Director
(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)