ITEM 1.
BUSINESS
Historical Development
Java Express, Inc. was incorporated on December 14, 2001, under the laws of the State of Nevada for the purpose of selling coffee and other related items to the general public from retail coffee shop locations.
From April through July of 2003, we conducted a limited offering in the State of Nevada pursuant to the exemption provided for under Section 3(b), Regulation D, Rule 504 of the Securities Act of 1933, as amended (the “Securities Act”), and in accordance with the Nevada Revised Statutes. We raised $79,000 for the purpose of pursuing our coffee kiosk business. On January 12, 2004, Java Express filed a registration statement on Form 10-SB on a voluntary basis in order to become subject to the reporting requirements of Section 13 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”).
Java was unsuccessful in establishing retail coffee shop locations and on September 29, 2004, acquired 100% ownership in K-Com Business Coaching Corp., a Utah Corporation (“K-Com”), and began developing K-Com’s existing business coaching operations. On January 30, 2006, we dissolved K-Com and all of its assets and liabilities were absorbed by Java Express. We were unsuccessful in fully implementing our K-Com business plan and have not generated any revenues from our coaching services since June 2006. Although management continued for a time to seek new clients and contracts, we have now ceased operations and are currently seeking funding sources, other business opportunities, and acquisitions. We are now considered a “blank check” company.
In March of 2008, we satisfied several outstanding convertible notes through the use of restricted stock. We also commenced a private offering of up to 1,100,000 common shares of restricted stock to “accredited” and/or “sophisticated” investors at $0.05 per share. The purpose of the offering was to satisfy one remaining convertible note, to pay various legal fees and to satisfy a $25,000 debt, which was settled for $19,000, to a former officer/director. The balance of the $55,000 proceeds was dedicated to working capital.
Our Business
We were originally incorporated to operate retail coffee shops but changed our business purpose in 2004 to that of consulting and coaching services for small business. We provided “in-depth” services to small businesses customized to their individual needs with a focus on: (1) writing business plans; (2) ongoing consulting services which included building and increasing organizational effectiveness, developing and implementing marketing ideas, and strategic planning, and (3) bookkeeping services. We were unsuccessful in fully implementing that plan and are seeking and investigating other business opportunities.
We are currently seeking potential assets, property or businesses to acquire, in a business combination, by reorganization, merger or acquisition. We have had no material business operations since June of 2006. Our plan of operation for the next 12 months is to: (i) consider guidelines of industries in which we may have an interest; (ii) adopt a business plan regarding engaging in the business of any selected industry; and (iii) to commence operations through funding and/or the acquisition or business combination with a “going concern” engaged in any industry selected. We are unable to predict the time as to when and if we may actually participate in any specific business endeavor, and we will be unable to do so until we determine any particular industry in which we may conduct business operations.
We are not currently engaged in any substantive business activity except the search for potential assets, property or businesses to acquire, and we have no current plans to engage in any other activity in the foreseeable future unless and until we complete any such acquisition. In our present form, we are deemed to be a “shell company” seeking to acquire or merge with a business or company. We do not intend to restrict our search for business opportunities to any particular business or industry, and the areas in which we will seek out business opportunities may include all lawful businesses. We recognize that the number of suitable potential business ventures that may be available to us will be extremely limited, and may be restricted to businesses or entities that desire to become a publicly-held company while avoiding what many may deem to be the adverse factors related to an initial public offering (“IPO”) as a method of “going public.” The most prevalent of these factors include the substantial time requirements, legal and accounting costs, the inability to obtain an underwriter who is willing to publicly offer and sell securities on behalf of the particular entity, the lack of or the inability to obtain the required financial statements for such an undertaking, state limitations on the amount of dilution to public investors in comparison to the stockholders of any such entity, along with other conditions or requirements imposed by various federal and state securities laws, rules and regulations and federal and state agencies that implement them.
Amendments to SEC Form 8-K regarding shell companies and transactions with shell companies require the filing of all information about an acquired company that would have been required to have been filed had any such company filed a Form 10 Registration Statement with the SEC, along with required audited, interim and pro forma financial statements, within four business days of the closing of any such transaction (Item 5.01(a)(8) of Form 8-K); and the recent amendments to SEC Rule 144 adopted by the SEC that were effective on February 15, 2008, that limit the resale of most securities of shell companies until 12 months after the filing of such information (the “Form 10 Information”), may eliminate many of the perceived advantages of going public transactions with shell companies. These types of transactions are customarily referred to as “reverse” reorganizations or mergers in which the acquired company’s stockholders become the controlling stockholders in the acquiring company and the acquiring company becomes the successor to the business operations of the acquired company. Regulations governing shell companies also deny the use of SEC Form S-8 for the registration of securities and limit the use of SEC Form S-8 to a reorganized shell company until the expiration of 60 days from when any such entity is no longer considered to be a shell company. This prohibition could further restrict opportunities for us to acquire companies that may already have stock option plans in place that cover numerous employees. In such instances, there may be no exemption from registration for the issuance of securities in any business combination to these employees, thereby necessitating the filing of a registration statement with the SEC to complete any such reorganization, and incurring the time and expenses that are normally avoided by reverse reorganizations or mergers.
Amendments to Rule 144, adopted by the SEC and effective on February 15, 2008, codify the SEC’s prior position limiting the tradeability of certain securities of shell companies, including those issued by us in any business combination, and further limit the tradeability of additional securities of shell companies; these proposals will further restrict the availability of opportunities for us to acquire any business or enterprise that desires to utilize us as a means of going public. See the heading “Rule 144” of Item 5, for a discussion of the general requirements of Rule 144 and the limitations of Rule 144 with respect to shell companies.
Any of these types of business combination transactions, regardless of the particular prospect, would require us to issue a substantial number of shares of our common stock that could amount to as much as 95% or more of our outstanding voting securities; accordingly, investments in the private enterprise, if available, would be much more favorable than any investment in us.
Management intends to consider a number of factors prior to making any decision to participate in any specific business endeavor, none of which may be determinative or provide any assurance of success. These may include, but will not be limited to, as applicable, an analysis of the quality of the particular business or entity’s management and personnel; the anticipated acceptability of any new products or marketing concepts that any such business or company may have; the merits of any such business’ or company’s technology or intellectual property; the present financial condition, projected growth potential and available technical, financial and managerial resources; working capital, history of operations and future prospects; the nature of present and expected competition; the quality and experience of any such business’ or company’s management services and the depth of management; the business’ or the company’s potential for further research, development or exploration; risk factors specifically related to the business’ or company’s operations; the potential for growth, expansion and profit; the perceived public recognition or acceptance of products, or services offered and trademarks and name identification; and numerous other factors that are difficult, if not impossible, to properly or accurately quantify or analyze, let alone describe or identify, without referring to specific objective criteria of an identified business or company.
Regardless, the results of operations of any specific entity may not necessarily be indicative of what may occur in the future, by reason of changing market strategies, plant or product expansion, changes in product emphasis, future management personnel and changes in innumerable other factors. Further, in the case of a new business venture or one that is in a research and development mode, the risks will be substantial, and there will be no objective criteria to examine the effectiveness or the abilities of its management or its business objectives. Also, a firm market for its products or services may yet need to be established, and with no past track record, the profitability of any such business will be unproven and cannot be predicted with any certainty.
Our management will attempt to meet personally with management and key personnel of any entity providing a potential business opportunity for us, visit and inspect material facilities, obtain independent analysis or verification of information provided and gathered, check references of material personnel and conduct other reasonably prudent measures calculated to ensure a reasonably thorough review of any particular business opportunity; however, due to time constraints of management and limited capital, these activities may be limited.
We are unable to predict the time as to when and if we may actually participate in any specific business endeavor or if at all. We anticipate that proposed business ventures will be made available to us through personal contacts of directors, executive officers and principal stockholders, professional advisors, broker dealers in securities, venture capital personnel and others who may present unsolicited proposals. In certain cases, we may agree to pay a finder’s fee or to otherwise compensate the persons who submit a potential business endeavor in which we eventually participate. Such persons may include our directors, executive officers and beneficial owners of our securities or their affiliates. In this event, such fees may become a factor in negotiations regarding any potential venture and, accordingly, may present a conflict of interest for such individuals. Management does not presently intend to acquire an interest in any business enterprise in which any member has an ownership interest.
Although we currently have no plans to do so, depending on the nature and extent of services rendered, we may compensate members of our management in the future for services that they may perform for us. Because we currently have extremely limited resources, and we are unlikely to have any significant resources until we have determined a business or enterprise to engage in or have completed a business combination, management expects that any such compensation would take the form of an issuance of shares of our common stock to these persons; this would have the effect of further diluting the holdings of our other stockholders. There are presently no preliminary agreements or understandings between us and members of our management respecting such compensation. Any shares issued to members of our management would be required to be resold under an effective registration statement filed with the SEC or could not be publicly sold until 12 months after we file the Form 10 information about the business combination with the SEC as now required by SEC Form 8-K. These provisions could further inhibit our ability to complete any business combination where finders or others who may be subject to these resale limitations refuse to provide us with any introductions or to close any such transactions unless they are paid requested fees in cash rather than our shares or unless we agree to file a registration statement with the SEC that includes any shares that are to be issued to them, at no cost to them. These expenses could limit potential acquisition candidates, especially those in need of cash resources, and could affect the number of shares that our stockholders retain following any such transaction, by reason of the increased expense.
Substantial fees are also often paid in connection with the completion of all types of business combinations, ranging from a small amount to as much as $600,000 or more. These fees are usually divided among promoters or founders or finders, after deduction of legal, accounting and other related expenses, and it is not unusual for a portion of these fees to be paid to members of management or to principal stockholders as consideration for their agreement to retire a portion of their shares of common stock or as consideration to them to provide an indemnification for all of our prior liabilities. Members of management may also actively negotiate or otherwise consent to the purchase of all or any portion of their shares of common stock as a condition to, or in connection with, a proposed business combination. It is not anticipated that any such opportunity will be afforded to other stockholders or that such other stockholders will be afforded the opportunity to approve or consent to any particular stock buy-out transaction. In the event that any such fees are paid or shares are purchased, these requirements may become a factor in negotiations regarding any business combination with us and, accordingly, may also present a conflict of interest for such individuals. We have no present arrangements or understandings respecting any of these types of fees or opportunities. Any of these types of fees that are paid in shares of our common stock will also be subject to the resale limitations embodied in the recent amendments to Rule 144 that prohibit, among other requirements, the public resale of these shares until 12 months after the filing of the Form 10 information with the SEC.
None of our directors, executive officers, founders or their affiliates or associates are currently involved in any negotiations with any representatives of the owners of any business or company regarding the possibility of a business combination with us.
Competitive Business Conditions and Our Competitive Position in the Industry and Methods of Competition
Management believes that there are literally thousands of shell companies engaged in endeavors similar to those engaged in by us; many of these companies have substantial current assets and cash reserves. Competitors also include thousands of other publicly-held companies whose business operations have proven unsuccessful, and whose only viable business opportunity is that of providing a publicly-held vehicle through which a private entity may have access to the public capital markets via a reverse reorganization or merger. There is no reasonable way to predict our competitive position or that of any other entity in these endeavors; however, we, having limited assets and no cash reserves, will no doubt be at a competitive disadvantage in competing with shell companies that have significant cash resources and have recent operating histories when compared with the complete lack of any substantive operations by us since June 2006.
Dependence on One or a Few Major Customers
Our directors and executive officers have not used any particular consultants, advisors or finders on a regular basis.
Need for any Governmental Approval of Principal Products or Services
Because we currently have no business operations, produce no products nor provide any services, we are not presently subject to any governmental regulation in this regard. However, in the event that we complete a business combination transaction, we will become subject to all governmental approval requirements to which the reorganized, merged or acquired entity is subject or may become subject.
Effect of Existing or Probable Governmental Regulations on our Business
We are subject to the following regulations of the SEC and applicable securities laws, rules and regulations:
Smaller Reporting Company
We are subject to the reporting requirements of Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and subject to the disclosure requirements of Regulation S-K of the SEC, as a “smaller reporting company.” That designation will relieve us of some of the informational requirements of Regulation S-K applicable to larger companies.
Sarbanes/Oxley Act
We are also subject to the Sarbanes/Oxley Act of 2002. The Sarbanes/Oxley Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies and strengthen auditor independence. It also requires steps to enhance the direct responsibility of senior members of management for financial reporting and for the quality of financial disclosures made by public companies; establishes clear statutory rules to limit, and to expose to public view, possible conflicts of interest affecting securities analysts; creates guidelines for audit committee members’ appointment, compensation and oversight of the work of public companies’ auditors; mandates management assessment of our internal controls; prohibits certain insider trading during pension fund blackout periods; requires companies and auditors to evaluate internal controls and procedures; and establishes a federal crime of securities fraud, among other provisions. Compliance with the requirements of the Sarbanes/Oxley Act will substantially increase our legal and accounting costs.
Exchange Act Reporting Requirements
Section 14(a) of the Exchange Act requires all companies with securities registered pursuant to Section 12(g) of the Exchange Act to comply with the rules and regulations of the SEC regarding proxy solicitations, as outlined in Regulation 14A. Matters submitted to stockholders at special or annual meetings thereof or pursuant to a written consent will require us to provide our stockholders with the information outlined in Schedules 14A or 14C of Regulation 14; preliminary copies of this information must be submitted to the SEC at least 10 days prior to the date that definitive copies of this information are forwarded to our stockholders.
We are also required to file Annual Reports on SEC Form 10-K and Quarterly Reports on SEC Form 10-Q with the SEC on a regular basis, and will be required to timely disclose certain material events (e.g., changes in corporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business; and bankruptcy) in a Current Report on SEC Form 8-K.
Cost and Effects of Compliance with Environmental Laws
Our current business operations are not subject to any material environmental laws, rules or regulations that would have an adverse material effect on our business operations or financial condition or result in a material compliance cost; however, we will become subject to all such governmental requirements to which the reorganized, merged or acquired entity is subject or may become subject, on the closing of a business combination.
Number of Total Employees and Number of Full-Time Employees
We have no employees.
ITEM 1A.
ITEM 1A.
RISK FACTORS
As a smaller reporting company, we are not required to provide risk factors
ITEM 2:
ITEM 2:
PROPERTIES
None.
ITEM 3:
ITEM 3:
LEGAL PROCEEDINGS
None; however, two shareholders have claimed that their shares of common stock were wrongfully transferred by the Company’s transfer agent to other parties based upon documents that contained forged signatures of such stockholders. The claim represents an aggregate of 190,000 shares. No legal proceedings have been filed against the Company; and the Company has responded to these claims and asserted that it has no liability to reissue these shares to these persons, based upon its review of applicable documentation.
ITEM 4:
ITEM 4:
[REMOVED AND RESERVED]
PART II
ITEM 5:
ITEM 5:
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
There is no “established trading market” for our shares of common stock. Commencing on or about March 21, 2005, our shares of common stock were listed on the OTC Bulletin Board of the Financial Industry Regulatory Authority, Inc. (“FINRA”) under the symbol “JVEX”; however, our shares are thinly traded and management does not expect any established trading market to develop in our shares of common stock unless and until we have material operations. In any event, no assurance can be given that any market for our common stock will develop or be maintained. If a public market ever develops in the future, the sale of shares of our common stock that are deemed to be “restricted securities” pursuant to Rule 144 of the SEC by members of management or others may have a substantial adverse impact on any such market. All current holders of shares of our common stock have satisfied the six-month holding period requirement of Rule 144, but may be limited from public sale by subparagraph (i) of Rule 144 because we are a shell company. See the heading “Shell Companies” below.
Set forth below are the high and low closing bid prices for our common stock for each quarter of fiscal years ended March 31, 2011 and 2010. These bid prices were obtained from the FINRA composite feed or other qualified interdealer quotation medium. All prices listed herein reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not represent actual transactions.
Holders
We currently have 31 shareholders, not including an indeterminate number who may hold shares in “street name.”
Dividends
We have never paid dividends on our common stock. The Board of Directors presently intends to pursue a policy of retaining earnings, if any, for use in our operations and to finance expansion of our business. Any declaration and payment of dividends in the future, of which there can be no assurance, will be determined by our Board of Directors in light of conditions then existing, including our earnings, financial condition, capital requirements and other factors. There are presently no dividends which are accrued or owing with respect to our outstanding stock. No assurance can be given that dividends will ever be declared or paid on our common stock in the future.
Recent Sales of Unregistered Securities
No unregistered securities were sold by us during the past three years.
Resales of Unregistered Securities
Resales of our unregistered securities must be made through an available exemption such as Rule 144 or Section 4(1) of the Securities Act in “routine trading transactions,” because their public sales, if any, must be made pursuant to an effective registration statement filed with the SEC or an available registration exemption like Rule 144, that will require a minimum holding period of one year from when we file the Form 8-K12G information about any acquisition, reorganization or merger that results in us no longer being considered to be a “shell company,” among other conditions. Any person who acquires any of our unregistered securities in a private transaction may be subject to the same resale requirements. (See below for a general discussion on Rule 144).
Rule 144 - Generally
The following is a summary of the current requirements of Rule 144:
Affiliate or Person Selling on
Behalf of an Affiliate
Non-Affiliate (and has not been an Affiliate During the Prior Three Months)
Restricted Securities of Reporting Issuers
During six-month holding period - no resales under Rule 144 Permitted.
After Six-month holding period - may resell in accordance with all Rule 144 requirements including:
·
Current public information,
·
Volume limitations,
·
Manner of sale requirements for equity securities, and
·
Filing of Form 144.
During six- month holding period - no resales under Rule 144 permitted.
After six-month holding period but before one year - unlimited public resales under Rule 144 except that the current public information requirement still applies.
After one-year holding period - unlimited public resales under Rule 144; need not comply with any other Rule 144 requirements.
Restricted Securities of Non-Reporting Issuers
During one-year holding period - no resales under Rule 144 permitted.
After one-year holding period - may resell in accordance with all Rule 144 requirements including:
·
Current public information,
·
Volume limitations,
·
Manner of sale requirements for equity securities, and
·
Filing of Form 144.
During one-year holding period - no resales under Rule 144 permitted.
After one-year holding period - unlimited public resales under Rule 144; need not comply with any other Rule 144 requirements.
Shell Companies
The following is an excerpt from Rule 144(i) regarding resales of securities of shell companies:
“(i)
Unavailability to securities of issuers with no or nominal operations and no or nominal non-cash assets.
(1)
This section is not available for the resale of securities initially issued by an issuer defined below:
(i)
An issuer, other than a business combination related shell company, as defined in §230.405, or an asset-backed issuer, as defined in Item 1101(b) of Regulation AB (§229.1101(b) of this chapter), that has:
(A)
No or nominal operations; and
(B)
Either:
(1) No or nominal assets;
(2) Assets consisting solely of cash and cash equivalents; or
(3) Assets consisting of any amount of cash and cash equivalents and nominal other assets; or
(ii)
An issuer that has been at any time previously an issuer described in paragraph (i)(1)(i).
(2)
Notwithstanding paragraph (i)(1), if the issuer of the securities previously had been an issuer described in paragraph (i)(1)(i) but has ceased to be an issuer described in paragraph (i)(1)(i); is subject to the reporting requirements of section 13 or 15(d) of the Exchange Act; has filed all reports and other materials required to be filed by section 13 or 15(d) of the Exchange Act, as applicable, during the preceding 12 months (or for such shorter period that the issue was required to file such reports and materials), other than Form 8-K reports (§249.308 of this chapter); and has filed current “Form 10 information” with the Commission reflecting its status as an entity that is no longer an issuer described in paragraph (i)(1)(i), then those securities may be sold subject to the requirements of this section after one year has elapsed from the date that the issuer filed “Form 10 information” with the Commission.
(3)
The term “Form 10 information” means the information that is required by Form 10 or Form 20-F (§249.220f of this chapter), as applicable to the issuer of the securities, to register under the Exchange Act each class of securities being sold under this rule. The issuer may provide the Form 10 information in any filing of the issuer with the Commission. The Form 10 information is deemed filed when the initial filing is made with the Commission.”
Securities of a “shell company” cannot be publicly sold under Rule 144 in the absence of compliance with this subparagraph, though the SEC has implied that these restrictions would not be enforced respecting securities issued by a “shell company” while it was not determined to be a “shell company.”
Section 4(1) of the Securities Act
Since we are a “shell company” as defined in subparagraph (i) of Rule 144, our shares of common stock cannot be publicly resold under Rule 144 until we comply with the requirements outlined above under the heading “Shell Companies.” Until those requirements have been satisfied, any resales of our shares of common stock must be made in compliance with the provisions of the exemption from registration under the Securities Act provided in Section 4(1) thereof, applicable to persons other than “an issuer, underwriter or a dealer.” That will require that such shares of common stock be sold in “routine trading transactions,” which would include compliance with substantially all of the requirements of Rule 144, regardless of its availability; and such resales may be limited to our non-affiliates. It is the position of the SEC that the Section 4(1) exemption is not available for the resale of any securities of an issuer that is or was a “shell company,” by directors, executive officers, promoters or founders or their transferees. See NASD Regulation, Inc., CCH Federal Securities Law Reporter, 1990-2000 Decisions, Paragraph No. 77,681, the so-called “Worm-Wulff Letter.”
Use of Proceeds of Registered Securities
We sold no registered securities during the period covered by this Annual Report.
Purchases of Equity Securities by Us and Affiliated Purchasers
During the last three fiscal years, there were no purchases of any equity securities of ours by us or any person on our behalf; nor were there any purchases of our equity securities by any affiliate of ours during the last three fiscal years
Securities Authorized for Issuance under Equity Compensation Plans
Plan Category
Number of Securities to be issued upon exercise of outstanding options, warrants and rights
Weighted-average exercise price of outstanding options, warrants and rights
Number of securities remaining available for future issuance under equity compensation plans excluding securities reflected in column (a)
(a)
(b)
(c)
Equity compensation plans approved by security holders
Equity compensation plans not approved by security holders
Total
None
None
None
ITEM 6:
ITEM 6:
SELECTED FINANCIAL DATA
The following chart summarizes our financial statements for the years ended March 31, 2011 and 2010 and should be read in conjunction with the financial statements, and notes thereto, included with this Annual Report at Part II, Item 8, below.
ITEM 7:
ITEM 7:
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Safe Harbor for Forward-Looking Statements
When used in this Annual Report, the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” and similar expressions are intended to identify forward-looking statements within the meaning of Section 27a of the Securities Act and Section 21e of the Exchange Act regarding events, conditions, and financial trends that may affect the Java’s future plans of operations, business strategy, operating results, and financial position. Persons reviewing this Annual Report are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and that actual results may differ materially from those included within the forward-looking statements as a result of various factors. Such factors are discussed under “Item 1A. Risk Factors”, and also include general economic factors and conditions that may directly or indirectly impact our financial condition or results of operations.
General
Java Express, Inc. was incorporated on December 14, 2001, under the laws of the State of Nevada for the purpose of selling coffee and other related items to the general public from retail coffee shop locations. We commenced our operations and purchased both kiosk designs and equipment as well as conducted marketing studies. We began working with a contractor to design a “turn-key” kiosk” and we began negotiations with various casinos and mall spaces in the Las Vegas, Nevada area for placement of the kiosks. We continued to develop the “turn-key’ kiosk concept for further marketing in other geographical areas once our first kiosk was established. Our competition, however, especially from well known coffee companies such as Starbucks, increased during that time period and we were ultimately unsuccessful in establishing our retail coffee shop locations. We began looking for other business opportunities. On September 29, 2004, we acquired 100% ownership in K-Com Business Coaching Corp., a Utah Corporation. We discontinued our efforts to establish a coffee shop business and began focusing on developing K-Com’s existing business coaching operations. K-Com provided us with over $200,000 in revenues in 2005 and 2006. On January 30, 2006, we dissolved K-Com Business Coaching Services and all of its assets and liabilities were absorbed Java Express and are reflected in our financial statements for the year ended March 31, 2006. Our revenues from our coaching services began decreasing during the last quarter of our 2006 fiscal year. We had no revenues from the coaching business in each of the last four fiscal years. We are now a “shell company.”
Plan of Operation
Our plan of operation for the next 12 months is to: (i) consider guidelines of industries in which we may have an interest; (ii) adopt a business plan regarding engaging in the business of any selected industry; and (iii) to commence such operations through funding and/or the acquisition of a “going concern” engaged in any industry selected.
During the next 12 months, our only foreseeable cash requirements will relate to maintaining our good standing or to the payment of our Securities and Exchange filing expenses and associated legal fees, accounting fees and costs incident to reviewing or verifying information about any potential business venture, any of which may be advanced by management or principal stockholders as loans to us. There is no agreement that management will advance these funds. We spent approximately $8,000 on accounting, legal and filing fees during our fiscal year ended March 31, 2011, to comply with our SEC filing requirements; in the prior year, we spent about the same for legal, accounting and filing fees. We anticipate that expenses associated with our SEC filing requirements will be the same or more in the next 12 months, especially with the additional burden of XBRL filing requirements, which we must begin to comply with for our June 30, 2011, quarterly report; our XBRL requirements will cost us approximately $2,500 more during the next 12 months.. We have only $878 to satisfy all of our cash requirements for the coming year which is insufficient to fund our minimum operations.
Because we have not determined any business or industry in which our operations will be commenced, and we have not identified any prospective venture as of the date of this Annual Report, it is impossible to predict the amount of any such management or shareholder loans. Any such loan will be on terms no less favorable to us than would be available from a commercial lender in an arm’s length transaction. As of the date of this Annual Report, we have not actively begun to seek any such venture. No advance or loan from any affiliate will be required to be repaid as a condition to any agreement with future acquisition partners.
When and if a business is commenced or an acquisition is made is presently unknown, and will depend upon various factors, including but not limited to, funding and its availability; and if and when any potential acquisition may become available to us at terms acceptable to us. The estimated costs associated with reviewing and verifying information about a potential business venture would be mainly for due diligence and the legal process, and could cost between $5,000 and $25,000. These funds will either be required to be loaned by management or raised in private offerings; we cannot assure you that we can raise these funds, if needed
Liquidity and Capital Resources
Balance Sheet Information
The following information is a summary of our balance sheet as of March 31, 2011
Summary Balance Sheet as of March 31, 2011
At March 31, 2011, our total current assets were $878 and consisted of cash and cash equivalents; we had no fixed assets. Liabilities at that date totaled $5,911 and consisted of notes payable and accrued interest, and advances.
Acquisition of Subsidiary through Issuance of Common Stock
We funded the acquisition of our subsidiary through the issuance of common stock. On September 29, 2004, the Company issued 1,200,000 shares of common stock for the 100% purchase of K-Com Business Coaching. The shares were issued in a private transaction without registration in reliance of the exemption provided by Section 4(2) of the Securities Act. No broker was involved and no commissions were paid on the transaction.
Funding Through Convertible Notes and Advances
Between 2004 and 2008, we consistently funded operations through loans from both related and non-related parties through various convertible notes. As of our year ended March 31, 2008, all of the notes were paid.
On June 3, 2010, the Company entered into a promissory note agreement for $750. The note is payable within eighteen months. The note has a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance was $750 with accrued interest of $50. The note maturity date is December 3, 2011.
On August 30, 2010 and September 29, 2010, the Company entered into promissory note agreements with a related party for $1,500 and $1,000, respectively. The notes have a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance was $2,500 with accrued interest of $111. The note maturity dates are February 28, 2012 and March 29, 2012, respectively.
On January 18, 2011 and March 14, 2011, the Company received advances from a related party for $1,000 and $1,500, respectively
Funding through Private Placement
On March 11, 2008, we authorized the private offering of a maximum of 1,100,000 shares of our common stock that are “restricted securities.” These shares were sold to Globe Energy Technologies LLC at $0.05 per share, for proceeds of $55,000. No commissions were paid. Globe Energy Technologies, LLC, is now a 49.7% shareholder and is controlled by Mark Burdge, a director of Java since that same date. A $25,000 debt to our former president was satisfied for $19,000 with these funds as well as a $5,458 convertible note. The balance of the proceeds are held in escrow and were used to pay legal fees associated with the offering of $5,000 and as working capital.
.
Funding Future Acquisitions and Operations
Our ability to fund our operations and future acquisitions is discussed above under “Plan of Operations.”
Off-Balance Sheet Arrangements
None.
ITEM 7A:
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 8.
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
JAVA EXPRESS, INC.
(a Development Stage Company)
Financial Statements
March 31, 2011
MADSEN & ASSOCIATES, CPA's Inc.
684 East Vine St, Suite 3
Certified Public: Accountants and Business Consultants
Murray, Utah 84107
Telephone 801 268-2632
Fax 801·262-3978
To the Board of Directors and
Stockholders of Java Express, Inc.
(A Development Stage Company)
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We have audited the accompanying balance sheets of Java Express, Inc. (A Development Stage Company) (The Company) as of March 31, 2011 and 2010, and the related statements of operations, stockholders’ equity, and cash flows for each of the years in the two-year period ended March 31, 2011, and for the period from December 14, 2001 (date of inception of Development Stage) to March 31, 2011. The Company’s management is responsible for these financial statements. Our responsibility is to express an opinion on these 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 purposes 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 financial statements referred to above present fairly, in all material respects, the financial position of Java Express, Inc. (a Development Stage Company) as of March 31, 2011 and 2010, and the results of its operations and its cash flows for each of the years in the two-year period ended March 31, 2011, and the period from December 14, 2001 (date of inception of Development Stage) to March 31, 2011, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company will need additional working capital to service its debt and for its planned activity, which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are described in the notes to the financial statements. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Madsen & Associates CPA’s Inc.
“Madsen & Associates, CPA’s Inc.”
Salt Lake City, Utah
June 17, 2011
The accompanying notes are an integral part of these financial statements
The accompanying notes are an integral part of these financial statements
JAVA EXPRESS, INC.
(Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
March 31, 2011
Organization
The Company was incorporated under the laws of the State of Nevada on December 14, 2001, with authorized 50,000,000 shares of $.001 par value common stock and 10,000,000 shares of $.001 par value preferred stock. There are no shares of the preferred stock issued and outstanding and the terms have not been defined. The Company’s fiscal year end is March 31. Since December 14, 2001, the Company has been in the development stage. Initially, the Company developed a “turn key” retail coffee kiosk design with the intention of operating retail kiosk(s) in the Las Vegas, Nevada area, and elsewhere. Although, and the Company began marketing the concept, it was determined that this venture would not be successful the Company sought other business opportunities. In September, 2004, the Company entered into business coaching through the acquisition of K-Com Business Coaching Corp. The Company operated this business until January 30, 2006. There have been no operations since that time.
On September 29, 2004, the Company entered into a plan of reorganization whereby they acquired 100% ownership in K-Com Business Coaching Corp., a Utah Corporation, in exchange for 1,200,000 shares of common stock.
On January 30, 2006, the Company dissolved its wholly-owned subsidiary, K-Com Business Coaching Corp. All of the assets and liabilities of K-Com were absorbed by the Company and are reflected in its financial statements for the year ended March 31, 2006, and are recorded at book value.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company recognizes income and expenses based on the accrual method of accounting.
Dividend Policy
The Company has not yet adopted a policy regarding payment of dividends.
Basic and Diluted Net Income (Loss) Per Share
Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been issued on the exercise of any common share rights unless the exercise becomes antidilutive and then the basic and diluted per share amounts are the same.
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements.
JAVA EXPRESS, INC.
(Development Stage Company)
NOTES TO FINANCIAL STATEMENTS - continued
March 31, 2011
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
Financial Instruments
The carrying amounts of financial instruments are considered by management to be their estimated fair values due to their short term maturities.
Income Taxes
The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recognized, when it is more likely than not, that such tax benefits will not be realized.
On March 31, 2011, the Company had a net operating loss available for carry forward of $494,029. The tax benefit of approximately $148,000 from the loss carryforward has been fully offset by a valuation reserve because the use of the future tax benefit is doubtful since the Company has been unable to project an estimated future operating profit. The loss carryforward expires beginning in the years 2024 through 2031.
Concentration of Credit Risk
There are no financial instruments that potentially subject the Company to significant concentration of credit risks.
Revenue Recognition
Revenue is recognized on the sale and delivery of a product or the completion of services provided.
Advertising and Market Development
The Company expenses advertising and market development costs as incurred.
Recent Accounting Pronouncements
The Company has reviewed recent accounting pronouncements and does not expect that the adoption of the recent accounting pronouncements will have a material impact on its financial statements.
JAVA EXPRESS, INC.
(Development Stage Company)
NOTES TO FINANCIAL STATEMENTS - continued
March 31, 2011
3. NOTES PAYABLE
On June 3, 2010, the Company entered into a promissory note agreement for $750. The note is payable within eighteen months. The note has a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance was $750 with accrued interest of $50. The note maturity date is December 3, 2011.
On August 30, 2010 and September 29, 2010, the Company entered into promissory note agreements with a related party for $1,500 and $1,000, respectively. The notes have a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance was $2,500 with accrued interest of $111. The note maturity dates are February 28, 2012 and March 29, 2012, respectively.
On January 18, 2011 and March 14, 2011, the Company received advances from a related party for $1,000 and $1,500, respectively.
4. SIGNIFICANT RELATED PARTY TRANSACTIONS
As of March 31, 2011, all activities of the Company were conducted by the principal corporate officer from either his home or business office.
On August 30, 2010 and September 29, 2010, the Company entered into promissory note agreements with a related party for $1,500 and $1,000, respectively. The notes have a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance was $2,500 with accrued interest of $111.
On January 18, 2011 and March 14, 2011, the Company received advances from a related party for $1,000 and $1,500, respectively.
During the year ended March 31, 2008, Globe Energy Technologies, LLC became a majority shareholder (49.7%) of the Company through its purchase of shares from the Company, certain selling shareholders and conversion of a promissory note. Globe Energy Technologies, LLC’s Managing Member is Mark Burdge, a director of the Company.
5. GOING CONCERN
Generally accepted accounting principles in the United States of America contemplate the continuation of the Company as a going concern. However, the Company had a net loss for the year ended March 31, 2011, of $8,163. Additionally it has accumulated operating losses since its inception and has limited business operations, which raises substantial doubt about the Company’s ability to continue as a going concern. The continuation of the Company is dependent upon the continuing financial support of investors and stockholders of the Company. The Company intends to attempt to acquire additional operating capital through private equity offerings to the public and existing investors to fund its business plan. However, there is no assurance that equity or debt offerings will be successful in raising sufficient funds to assure the eventual profitability of the Company. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.
ITEM 9:
ITEM 9:
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A(T):
ITEM 9A(T):
CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our President, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report. Based on that evaluation, our President and concluded that our disclosure controls and procedures as of the end of the period covered by this Annual Report were effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our President, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.
Our management, with the participation of the President, evaluated the effectiveness of our internal control over financial reporting as of March 31, 2011. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework. Based on this evaluation, our management, with the participation of the President, concluded that, as of March 31, 2011 our internal control over financial reporting was effective.
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 Security and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.
Changes in internal control over financial reporting
There have been no changes in internal control over financial reporting.
ITEM 9B:
ITEM 9B:
OTHER INFORMATION
None.
PART III
ITEM 10:
ITEM 10:
DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
Identification of Officers and Directors
Our executive officers and directors and their respective ages, positions and biographical information are set forth below.
Name
Age
Positions Held
Director Since
Mark C. Burdge
Director
March 2008
President and Chief Executive Officer
Del Higginson
Director
February 2009
Secretary, Treasurer, Chief Financial Officer
Del Higginson began serving as a Director, and as Chief Financial Officer, Treasurer and Secretary on February 9, 2009. Mark Burdge began serving as a director on March 11, 2008, when he acquired 49.7% of our outstanding shares. Mark Burdge was appointed to the positions of President and Chief Executive Officer on February 9, 2009.
Background and Business Experience
Mark Burdge is currently a director, President and Chief Executive Officer. He is also a principal of Evergreen Clean Energy, LLC, a clean energy investment corporation. Evergreen invests in clean energy power generation facilities. From 1994 through 2007, Mr. Burdge was President of Excel Graphics, a full service graphic arts company. He developed the business from $1,000,000 annually to $23,000,000 annually in the first 10 years. Excel featured state of the art sheet-fed printing, heat-set web printing, folding carton manufacturing, direct mail, kitting and fulfillment. Excel ceased operations in 2007 due to increasing competition from China. From 2002 to 2006, Mr. Burdge was president of Indigo Media, a publisher of custom niche market publications and producer of nation wide point of purchase campaigns. Indigo also owns and operates a state of the art digital print center for on-demand publishing of marketing collateral, including direct mail campaigns. In addition, from 2002 - 2006, Mr. Burdge was President of Indigo Creative, a full-service advertising agency. Indigo’s staff including professional graphic designers, photographers, marketing and creative services, studio engineering and marketing campaign management. From 2004 through 2006, Mark Burdge was a partner in Rimports (USA) LLC. Rimports negotiates manufacturing relationships between U.S. corporations and Pacific Rim manufacturing companies. Rimports also manufactures and markets its own line of consumer products that are currently sold in Wal-Mart and other national retailers.
Del Higginson is 56 years and is retired. He currently serves as a director, Chief Financial Officer, Treasurer and Secretary. From 2004 - 2005, he was employed in the Motor Testing Lab of Raser Technologies, Inc of Provo, Utah, where he performed maintenance and equipment testing. From 2001 - 2003, he worked for OTS - On Target System - of Highland Utah, where he designed and custom built specialty targets for customers, and handled sales, service and installations. From 1995 -2001, he was employed by Action Target of Provo, Utah, where he performed service and installation of firearm shooting equipment for law enforcement and military throughout the United States. Action Target merged with OTS in 2003. Mr. Higginson studied at Utah Valley Trade Tech and Denver School of Plastic Design and Engineering.
Involvement in Other Public Companies
Neither of our directors serves on the board of any other public companies.
Previous Blank Check or Shell Company Experience
In the last five years, neither of our directors has had any blank check or “shell company” experience.
Significant Employees
The Company has no employees who are not executive officers, but who are expected to make a significant contribution to the Company’s business.
Term of Office
The term of office for our directors is one year, or until a successor is elected and qualified at the Company’s annual meeting of shareholders, subject to ratification by the shareholders. The term of office for each officer is one year or until a successor is elected and qualified and is subject to removal by the Board.
Family Relationships
None.
Section 16(a) Beneficial Ownership Reporting Compliance
Our common shares are registered under the Exchange Act and therefore our officers, directors and holders of more than 10% of our outstanding shares are subject to the provisions of Section 16(a) which requires them to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and our other equity securities. Officers, directors and greater than ten-percent beneficial owners are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file. No forms were filed or required to be filed during this fiscal year:
Code of Ethics
We have adopted a code of ethics for our principal executive and financial officers. Our code of ethics was filed as an exhibit to our 10-KSB for December 31, 2004.
No Involvement in Certain Legal Proceedings
During the past 10 years, to our knowledge, none of our present or former directors, executive officers or persons nominated to become directors or executive officers has been the subject of any of the following:
(1) A petition under the federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two (2) years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two (2) years before the time of such filing;
(2) Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
(3) Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:
(i) Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
(ii) Engaging in any type of business practice; or
(iii) Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;
(4) Such person was the subject of any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
(5) Such person was found by a court of competent jurisdiction in a civil action or by the SEC to have violated any federal or state securities law, and the judgment in such civil action or finding by the SEC has not been subsequently reversed, suspended, or vacated;
(6) Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
(7) Such person was the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
(i) Any federal or state securities or commodities law or regulation; or
(ii) Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
(iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
(8) Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
Corporate Governance
Nominating Committee
We have not established a Nominating Committee because, due to our lack of operations and the fact that we only have two directors and executive officers, we believe that we are able to effectively manage the issues normally considered by a Nominating Committee. Following the entry into any business or the completion of any acquisition, merger or reorganization, a further review of this issue will no doubt be necessitated and undertaken by new management.
If we do establish a Nominating Committee, we will disclose this change to our procedures in recommending nominees to our board of directors.
Audit Committee
We have not established an Audit Committee because, due to our lack of operations and the fact that we only have two directors and executive officers, we believe that we are able to effectively manage the issues normally considered by an audit committee. Following the entry into any business or the completion of any acquisition, merger or reorganization, a further review of this issue will no doubt be necessitated and undertaken by new management.
ITEM 11.
ITEM 11.
EXECUTIVE COMPENSATION
All Compensation
None of our current executive officers received any compensation since they began their respective periods of service as detailed below.
SUMMARY COMPENSATION TABLE
Name and Principal
Positions
(a)
Year
(b)
Salary
($)
(c)
Bonus
($)
(d)
Stock
Awards
($)
(e)
Option
Awards
($)
(f)
Non-Equity
Incentive
Plan
Compensation
($)
(g)
Nonqualified
Deferred
Compensation
($)
(h)
All Other
Compensation
($)
(i)
Total
Earnings
($)
(j)
Mark Burdge
Director,
President. CEO (1)
03/31/2011
03/31/2010
Del Higginson
Director, Treasurer,
CFO (2)
03/31/2011
03/31/2010
(1)
Mark Burdge did not begin serving as CEO and President until February 9, 2009
(2)
Del Higginson did not begin serving as a Director, Treasurer and CFO until February 9, 2009
Director Compensation
We do not have any standard arrangement for compensation of our directors for any services provided as director, including services for committee participation or for special assignments. Our directors received no compensation for service as directors for the year ended March 31, 2011.
Outstanding Equity Awards
None.
Options/SAR Grants in the Last Fiscal Year
None. We have no outstanding options or stock appreciation rights.
Options/SAR Exercises in the Last Fiscal Year
None. We have no outstanding options or stock appreciation rights.
Long Term Incentive Plan Awards in the Last Fiscal Year
None. We have no long-term incentive plans.
ITEM 12:
ITEM 12:
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Security Ownership of Certain Beneficial Owners
The following table sets forth the ownership by any person known to us to be the beneficial owner of more than 5% of any class of our voting securities as of June 9, 2011. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. The persons named in the table below have sole voting power and investment power with respect to all shares of common stock shown as beneficially owned by them. The percentage of beneficial ownership is based upon 11,280,140 shares of common stock outstanding at that date.
CERTAIN BENEFICIAL OWNERS
Title of
Name and Address of
Amount and Nature of
Percentage
Class
Beneficial Owners
Beneficial Ownership (1)
of Class
Common
Globe Energy Technologies LLC (2)
5,606,700
49.70%
5055 N. Edgewood Dr
Provo, UT 84804
Common
Mark Sansom
1,010,000
8.95%
4061 Power Circle
Salt Lake City, UT 84124
Common
Kelly Trimble
1,912,440
16.95%
4685 S. Highland Dr., #207
Salt Lake City UT 84117
Common
David West
918,975
8.15%
5005 Edgewood Dr. #110
Provo, UT 84604
(1)
All share ownership is direct.
(2)
Globe Energy Technologies LLC (“Globe”) became a majority shareholder through the purchase of shares from Java, selling shareholders, and the conversion of a promissory note. Mark Burge, a director since March 11, 2008, is the managing member of Globe.
SEC Rule 13d-3 generally provides that beneficial owners of securities include any person who, directly or indirectly, has or shares voting power and/or investment power with respect to such securities, and any person who has the right to acquire beneficial ownership of such security within 60 days. Any securities not outstanding which are subject to such options, warrants or conversion privileges exercisable within 60 days are treated as outstanding for the purpose of computing the percentage of outstanding securities owned by that person. Such securities are not treated as outstanding for the purpose of computing the percentage of the class owned by any other person. At the present time there are no outstanding options or warrants.
Security Ownership of Management
The following table sets forth the ownership by each of directors and officers of any class of our voting securities as of the latest practicable date, June 9, 2011. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. The persons named in the table below have sole voting power and investment power with respect to all shares of common stock shown as beneficially owned by them. The percentage of beneficial ownership is based upon 11,280,140 shares of common stock outstanding at that date.
MANAGEMENT
Title of
Name and Address of
Amount and Nature of
Percentage
Class
Beneficial Owners
Beneficial Ownership
of Class
Common
Del Higginson
11148 No. Sunflower Dr.
Highland UT 84003
Director, CFO, Secretary, Treasurer
Common
Mark Burdge
5,606,700 (1)
49.70%
5055 N. Edgewood Dr
Provo, UT 84804
Director, CEO, President
Common
Officers and Directors As a Group (2 persons)
5,606,700
49.70%
(1)
These shares are held in the record name of Globe Energy Technologies LLC of which Mr. Burdge is the managing member and controls the shares in its name.
SEC Rule 13d-3 generally provides that beneficial owners of securities include any person who, directly or indirectly, has or shares voting power and/or investment power with respect to such securities, and any person who has the right to acquire beneficial ownership of such security within 60 days. Any securities not outstanding which are subject to such options, warrants or conversion privileges exercisable within 60 days are treated as outstanding for the purpose of computing the percentage of outstanding securities owned by that person. Such securities are not treated as outstanding for the purpose of computing the percentage of the class owned by any other person. At the present time there are no outstanding options or warrants.
Securities Authorized for Issuance under Equity Compensation Plans
None. We have no equity compensations plans.
Changes in Control
We do not have any arrangements that would result in any change in control of our company. However, there are no provisions in our Articles of Incorporation or Bylaws that would delay, defer or prevent a change in control.
ITEM 13:
ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The following information summarizes transactions we have either engaged in during the last two years, or propose to engage in, involving our executive officers, directors, more than 5% stockholders, promoters or founders, or immediate family members of these persons, or promoter or founder, or immediate family of such persons, which equals either $120,000 or an aggregate one percent of the average of our total assets at the year end of our last two fiscal years, whichever is less:
All activities of Java Express are conducted by Mr. Mark Burdge, a director and chief executive officer, from his home or business office. Mr Burdge owns 49.7 % of our outstanding shares in the name of Globe Energy Technologies LLC of which he is a managing member. On March 11, 2008, Globe Energy Technologies, LLC (“Globe”) became a majority shareholder through the purchase of shares from Java, selling shareholders and the conversion of a note. Globe acquired 990,000 shares of our stock from Howard Abrams (then director, CEO and CFO) for $0.02 per share; acquired, compromised and converted a $143,700 convertible note into 3,516,700 common shares, and purchased 1,100,000 shares of our common stock in a private placement for $55,000. The transactions resulted in Globe Energy Technologies LLC owning 5,606,700 shares or 49.7% of our common stock. Mark Burdge became a director of Java Express on that same date.
In addition, during our fiscal year ended March 31, 2011, 5% shareholders have loaned or advanced Java Express an aggregate of $5,750. Advances equaled $2,500; the balance is comprised of promissory notes with a stated interest rate of 8% per annum. As of March 31, 2011 the principal balance on the notes was $2,500 with accrued interest of $111.
Resolving Conflicts of Interest
Our directors must disclose all conflicts of interest and all corporate opportunities to the entire board of directors. Any transaction involving a conflict of interest will be conducted on terms not less favorable than that which could be obtained from an unrelated third party.
Director Independence
We do not have any independent directors serving on our board of directors.
ITEM 14:
ITEM 14:
PRINCIPAL ACCOUNTING FEES AND SERVICES
The following is a summary of the fees billed to us by our principal accountants during the fiscal years ended March 31, 2011 and 2010:
Audit Fees - Consists of fees for professional services rendered by our principal accountants for the audit of our annual financial statements and review of the financial statements included in our Forms 10-Q or services that are normally provided by our principal accountants in connection with statutory and regulatory filings or engagements.
Audit-related Fees - Consists of fees for assurance and related services by our principal accountants that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit fees.”
Tax Fees - Consists of fees for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning.
All Other Fees - Consists of fees for products and services provided by our principal accountants, other than the services reported under “Audit fees,” “Audit-related fees,” and “Tax fees” above.
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
We have not adopted an Audit Committee; therefore, there is no Audit Committee policy in this regard. However, we do require approval in advance of the performance of professional services to be provided to us by our principal accountant. Additionally, all services rendered by our principal accountant are performed pursuant to a written engagement letter between us and the principal accountant.
ITEM 15:
ITEM 15:
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a)(1)(2)
Financial Statements. See the audited financial statements for the year ended March 31,
2011 contained in Item 8 above which are incorporated herein by this reference.
(a)(3)
Exhibits. The following exhibits are filed as part of this Annual Report:
No.
Description
(1)
Filed with our initial Form 10SB Registration Statement on January 12, 2004.
(2)
Filed as Exhibit 2.0 to Form 8-K filed with the SEC on October 5, 2006
(3)
Filed with our Form 10-KSB for March 31, 2004 on July 14, 2004.
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: JUNE 24, 2011
JAVA EXPRESS, INC.
By: /s/ Mark Burdge
Mark Burdge
President, Director
Principal Executive Officer
In accordance with the Exchange Act, this Annual Report has been signed below by the following person on behalf of the registrant and in the capacities and on the dates indicated.
Date: JUNE 24, 2011
/s/ Mark Burdge
Mark Burdge
President, Principal Executive Officer
Director
Date: JUNE 24, 2011
/s/ Del Higginson
Del Higginson
Chief Financial Officer, Treasurer & Secretary
Director