Business Context and Reporting Period
This Form 10-K covers the fiscal year ended December 31, 2009, for FrameWaves, Inc. (Note: The input metadata lists "Nexttrip, Inc.", but the filing text explicitly identifies the registrant as FrameWaves, Inc., a Nevada corporation). The Company is classified as a "smaller reporting company" and a "shell company" with no active operations. It operates as a "blank check" company seeking a business combination or merger with a target entity to provide a path to public markets. The Company has had no revenues since the fourth quarter of 2001 and currently has no employees.
Key Financial Metrics
| Metric | 2009 | 2008 |
|---|---|---|
| Revenue | $0 | $0 |
| Net Loss | $(10,184) | $(7,642) |
| Cash and Cash Equivalents | $48 | $298 |
| Total Assets | $48 | $298 |
| Total Liabilities | $27,060 | $23,926 |
| Working Capital | $(27,012) | $(23,628) |
| Accumulated Deficit | $(77,438) | $(67,254) |
Debt and Liquidity: The Company holds a $15,000 unsecured note payable to a stockholder (officer/director) bearing 8% interest, due on demand. Accrued interest on this note was $3,790 as of December 31, 2009. Accounts payable totaled $8,270. The Company has no lines of credit and insufficient cash to meet immediate operational needs.
Material Changes vs. Prior Period
- Net Loss Increase: Net loss increased by approximately 33% from $7,642 in 2008 to $10,184 in 2009.
- Expense Growth: General and administrative expenses rose from $6,457 to $8,984, primarily due to accounting, legal, and professional costs required for SEC compliance.
- Liquidity Deterioration: Cash on hand decreased from $298 to $48. Total liabilities increased by $3,134, driven by accrued interest and accounts payable.
- Stock Price: While there was no trading volume, the closing bid price fluctuated between $0.15 and $0.56 in 2009, compared to a stable $0.15 in 2008.
Outlook, Risks, and Management Commentary
Plan of Operation: Management intends to continue searching for a business opportunity to merge with or acquire. The Company received a non-binding letter of intent on February 23, 2010, regarding an Exchange Agreement, but no definitive agreement has been reached. Management anticipates operating expenses of $5,000 to $10,000 for the next twelve months.
Going Concern: The independent auditor has issued a "going concern" opinion. The Company's ability to continue operations is dependent on raising additional capital through stock sales or loans from officers, as current cash is insufficient.
Risks:
- Speculative Nature: No assurance exists that a suitable target company will be found or that a merger will be consummated.
- Liquidity: The stock is subject to "Penny Stock" rules, severely limiting liquidity and resale ability.
- Management Time: Officers devote only approximately 20 hours per month to the Company and have other business interests.
- Dilution: Any future business combination will likely involve issuing significant shares, diluting existing shareholders.
Investor Verification Checklist
- Going Concern Status: Verify the Company's ability to secure the estimated $5,000–$10,000 needed for upcoming operating expenses.
- Related Party Debt: Confirm the status of the $15,000 note payable to the officer/director and the $3,790 accrued interest.
- Merger Progress: Monitor the status of the non-binding letter of intent received in February 2010 to determine if a definitive agreement is reached.
- Stock Liquidity: Acknowledge the lack of an active market and the restrictions imposed by Penny Stock regulations on the OTCBB.
- Management Commitment: Note that officers are not full-time employees and have no written employment agreements.