Bone Biologics Corp. — Filing Summary
Entity and period: The request identifies Bone Biologics Corp., but the supplied Form 10-Q is for AFH Acquisition X, Inc., a Delaware development-stage blank-check company and shell company. It covers the quarter and six months ended April 30, 2013; the statements are unaudited. The filing says AFH was wholly owned by AFH Holding & Advisory, LLC. The entity mismatch should be verified before relying on this summary.
Financial performance and position
- Revenue: None in the three- or six-month periods; the company reported no revenue from inception through April 30, 2013.
- Expenses and loss: For the quarter, total expenses were $1,073 and net loss after $400 franchise tax was $1,473, versus $1,750 and $2,150, respectively, in the prior-year quarter. For the six months, expenses were $2,691 and net loss after franchise tax was $3,091, compared with $3,106 and $3,506 in the prior-year period. Basic and diluted loss per share was reported as $0.00 for these interim periods.
- Cash flow: Six-month operating cash outflow was $460, offset by $400 in net financing cash flow from the parent, producing a $60 decrease in cash. Cash was $440 at April 30, 2013, down from $500 at October 31, 2012. No investing cash flows were reported.
- Balance sheet and liquidity: Total assets were $440. Liabilities were $38,130, comprising $7,125 of accrued expenses and $31,005 due to the parent; the latter has no stated repayment terms. Stockholders’ deficit was $37,690, including an accumulated development-stage deficit of $62,690. The filing’s MD&A states negative working capital of $62,690, but that figure does not reconcile to the balance sheet amounts; using reported current assets and liabilities yields negative working capital of $37,690.
- Margins and debt: Gross and operating margins are not meaningful given no revenue. No bank or other third-party debt is identified; the parent advance is reported as a liability.
Changes, outlook, risks, and other disclosures
- Compared with the prior-year six months, net loss improved by $415, and operating cash flow declined from zero to an outflow of $460. The filing attributes expenses principally to legal, accounting, and other professional fees.
- AFH had not begun active operations beyond seeking acquisition candidates and was not negotiating with a target as of the financial statements. Management said it expected to fund administrative expenses through stock issuance or additional shareholder capital; there is no assurance funding or an acquisition will occur.
- The company disclosed substantial doubt about its ability to continue as a going concern, citing recurring losses, limited resources, and dependence on raising capital or acquiring a marketable company. The statements include no adjustments for a possible failure to continue as a going concern.
- Management warned that a business combination could significantly dilute existing shareholders and that future securities issuance could pressure the share price if a trading market develops. The filing provides no specific acquisition timetable or financial forecast.
- Management reported disclosure controls and procedures were effective and no significant quarterly change in internal controls. The filing lists no legal proceedings, unregistered equity sales, or defaults upon senior securities.
Key facts for investors to verify
- Confirm whether this AFH Acquisition X, Inc. filing is the intended filing for Bone Biologics Corp.; the names do not match.
- Reconcile the MD&A’s stated negative working capital of $62,690 with the balance-sheet amounts, which indicate $37,690.
- Verify current funding arrangements and the status of any acquisition search, including whether the parent expects repayment of its $31,005 advance.
- Assess the going-concern warning, the company’s ability to raise capital, and potential dilution from a future business combination.