Business Context and Reporting Period
Company: R&R Acquisition VI, Inc. (Note: Metadata listed "ADMA BIOLOGICS, INC." but the filing text identifies the registrant as R&R Acquisition VI, Inc.)
Reporting Period: Fiscal year ended June 30, 2011
Business Type: Development stage "blank check" company and shell company.
Objective: To investigate and acquire a target company to achieve long-term growth potential. The company has no specific business plan, no employees, and no material assets other than cash. It is not currently engaged in any revenue-generating operations.
Key Financial Metrics
| Metric | 2011 | 2010 |
|---|---|---|
| Revenue | $0 | $0 |
| Total Operating Expenses | $26,464 | $20,530 |
| Net Loss | $(26,460) | $(20,526) |
| Cash and Cash Equivalents | $8,512 | $12,012 |
| Working Capital | $(1,306) | $(346) |
| Accrued Expenses (Liabilities) | $9,818 | $12,358 |
| Stockholders' Equity (Deficit) | $(1,306) | $(346) |
Liquidity: The company relies on capital contributions and loans from stockholders and management. Cash on hand ($8,512) is intended to cover expenses for the next 12 months, though there is no assurance of future funding.
Material Changes vs. Prior Period
- Expenses: Total operating expenses increased by approximately 29% from $20,530 in 2010 to $26,464 in 2011. This increase is attributed to higher professional and administrative fees.
- Cash Position: Cash decreased by $3,500 (from $12,012 to $8,512) due to net cash used in operating activities of $29,000, partially offset by $25,500 in contributed capital.
- Liabilities: Accrued expenses decreased by $2,540, indicating some payment of prior obligations.
- Equity: Additional paid-in capital increased by $25,500 due to a capital contribution from a stockholder during the fiscal year.
Outlook, Risks, and Management Commentary
- Outlook: Management plans to locate a suitable acquisition or merger candidate over the next 12 months. No definitive agreements exist with any prospective targets. Success is entirely dependent on consummating a business combination.
- Risks:
- Going Concern: The company has no operating history and sustains losses. There is a risk it cannot continue as a going concern without a merger or additional financing.
- Competition: Faces significant competition from better-financed entities for potential acquisition targets.
- Management Time: Officers devote less than 10% of their time to the company, which may delay identifying a target.
- Dilution: Future mergers may result in substantial dilution to existing shareholders through the issuance of additional shares.
- Conflicts of Interest: Management is involved with other blank check companies and may receive compensation from target companies.
- Unusual Items: The company is a shell company with no public trading market for its stock. It has never paid dividends and does not intend to do so.
Investor Verification Checklist
- Capital Adequacy: Verify if the current cash balance ($8,512) is sufficient to maintain SEC reporting compliance for the next 12 months without further stockholder contributions.
- Related Party Transactions: Confirm the terms of the office occupancy agreement with Kirk M. Warshaw, LLC (an affiliate of the CFO) and the source of the $25,500 capital contribution.
- Management Commitment: Assess the impact of officers devoting less than 10% of their time to the company on the likelihood of finding a merger target.
- Stock Ownership: Note that R&R Investments VI, LLC controls 80% of the outstanding shares, giving them significant control over merger decisions.
- Accrued Liabilities: Investigate the nature of the $9,818 in accrued expenses to ensure no hidden obligations exist.