Attached files
file | filename |
---|---|
EX-32.1 - BOLDFACE GROUP, INC. | v210089_ex32-1.htm |
EX-31.1 - BOLDFACE GROUP, INC. | v210089_ex31-1.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
(Mark
One)
x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
quarterly period ended December
31, 2010
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
transition period from _______ to _______
Commission
File Number: 333-148722
MAX
CASH MEDIA, INC.
(Exact
name of registrant as specified in its charter)
Nevada
|
02-0811868
|
(State
or other jurisdiction of incorporation)
|
(I.R.S.
Employer Identification No.)
|
50
Brompton Road, Apt. 1X
Great
Neck, NY 11021
(Address
of principal executive offices)
(646)
303-6840
(Registrant’s
telephone number, including area code)
Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x No ¨
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes ¨ No
¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ¨
|
Accelerated filer ¨
|
Non-accelerated filer ¨
|
Smaller reporting company x
|
|||
(Do not check if a smaller
Reporting company)
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes x No ¨
There
were 6,370,000 shares of the
registrant’s common stock, $0.001 par value per share, outstanding as of February
4,
2011.
MAX CASH
MEDIA, INC.
FORM
10-Q
FOR THE
QUARTERLY PERIOD ENDED DECEMBER 31, 2010
TABLE OF
CONTENTS
Page
|
||
PART
I - FINANCIAL INFORMATION
|
3
|
|
Item
1.
|
Financial
Statements
|
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
13
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
16
|
Item
4.
|
Controls
and Procedures
|
16
|
PART
II - OTHER INFORMATION
|
18
|
|
Item
1.
|
Legal
Proceedings
|
18
|
Item
1A.
|
Risk
Factors
|
18
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
18
|
Item
3.
|
Defaults
Upon Senior Securities
|
18
|
Item
4.
|
(Removed
and Reserved)
|
18
|
Item
5.
|
Other
Information
|
18
|
Item
6.
|
Exhibits
|
18
|
SIGNATURES
|
19
|
2
PART
I – FINANCIAL INFORMATION
Item
1. Financial
Statements
PAGE
|
|
Condensed
Balance Sheets as of December 31, 2010 (unaudited) and September 30,
2010
|
4
|
Condensed
Statements of Operations for the three months ended December 31, 2010
and 2009 (unaudited), and for the period from July 9, 2007 (inception) to
December 31, 2010 (unaudited).
|
5
|
Condensed
Statement of Changes in Stockholders’ Equity/(Deficiency) for the period
from July 9, 2007 (inception) to December 31, 2010
(unaudited)
|
6
|
Condensed
Statements of Cash Flows for the three months ended December 31, 2010
and 2009 (unaudited), and for the period from July 9, 2007 (inception) to
December 31, 2010 (unaudited)
|
7
|
Notes
to Condensed Financial Statements (unaudited)
|
8
|
3
Max
Cash Media, Inc.
(A
Development Stage Company)
Condensed Balance
Sheets
December
31,
|
September
30,
|
|||||||
2010
|
2010
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current
Assets
|
||||||||
Cash
|
$ | 1,721 | $ | 11,410 | ||||
Total
Assets
|
$ | 1,721 | $ | 11,410 | ||||
LIABILITIES AND STOCKHOLDERS'
DEFICIENCY
|
||||||||
Current
Liabilities
|
||||||||
Accounts
Payable
|
$ | 18,452 | $ | 9,230 | ||||
Accrued
Interest Payable
|
10,596 | 7,824 | ||||||
Note
Payable
|
65,000 | - | ||||||
Convertible
Note Payable
|
- | 50,000 | ||||||
Current Liabilities
|
94,048 | 67,054 | ||||||
Long
Term Liabilities
|
||||||||
Convertible
Note Payable
|
50,000 | - | ||||||
Note
Payable
|
- | 65,000 | ||||||
Total
Liabilities
|
144,048 | 132,054 | ||||||
Commitments
and Contingencies
|
- | - | ||||||
Stockholders'
Deficiency
|
||||||||
Preferred
stock, $0.001 par value; 10,000,000 shares authorized, none
issued and outstanding
|
- | - | ||||||
Common
stock, $0.001 par value; 100,000,000 shares authorized, 6,370,000 shares
issued and outstanding, respectively
|
6,370 | 6,370 | ||||||
Additional
paid-in capital
|
149,673 | 149,023 | ||||||
Deficit
accumulated during the development stage
|
(298,370 | ) | (276,037 | ) | ||||
Total
Stockholder's Deficiency
|
(142,327 | ) | (120,644 | ) | ||||
Total
Liabilities and Stockholders' Deficiency
|
$ | 1,721 | $ | 11,410 |
See
accompanying notes to condensed unaudited financial statements.
4
Max
Cash Media, Inc.
(A
Development Stage Company)
Condensed Statements of
Operations
(Unaudited)
For the Three Months Ended
|
For the period from July 9,
2007
|
|||||||||||
December 31, 2010
|
December 31, 2009
|
(Inception) to December 31,
2010
|
||||||||||
Operating
Expenses
|
||||||||||||
Professional
fees
|
$ | 17,374 | $ | 35,013 | $ | 243,301 | ||||||
General
and administrative
|
2,188 | 1,662 | 45,360 | |||||||||
Total
Operating Expenses
|
19,562 | 36,675 | 288,661 | |||||||||
Loss
from Operations
|
(19,562 | ) | (36,675 | ) | (288,661 | ) | ||||||
Other
Income / (Expense)
|
||||||||||||
Interest
Income
|
2 | 2 | 888 | |||||||||
Interest
Expense
|
(2,773 | ) | (1,134 | ) | (10,597 | ) | ||||||
Total
Other Income / (Expense) - net
|
(2,771 | ) | (1,132 | ) | (9,709 | ) | ||||||
LOSS
FROM OPERATIONS BEFORE INCOME TAXES
|
(22,333 | ) | (37,807 | ) | (298,370 | ) | ||||||
Provision
for Income Taxes
|
- | - | - | |||||||||
NET
LOSS
|
$ | (22,333 | ) | $ | (37,807 | ) | $ | (298,370 | ) | |||
Net
Loss Per Share - Basic and Diluted
|
$ | (0.00 | ) | $ | (0.01 | ) | ||||||
Weighted
average number of shares outstanding during the year/period - Basic and
Diluted
|
6,370,000 | 6,370,000 |
See
accompanying notes to condensed unaudited financial statements.
5
(A
Development Stage Company)
Condensed
Statement of Changes in Stockholders' Equity/(Deficiency)
For the period from July 9,
2007 (Inception) to December 31, 2010
(Unaudited)
Deficit
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
stock
|
Additional
|
accumulated
during the
|
Total
|
||||||||||||||||||||||||||||
paid-in
|
development
|
Subscription
|
Stockholders'
|
|||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
capital
|
stage
|
Receivable
|
Equity/(Deficiency)
|
|||||||||||||||||||||||||
Balance
July 9, 2007
|
- | $ | - | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||
Common
stock issued for services to founder ($0.001)
|
- | - | 5,000,000 | 5,000 | - | - | - | 5,000 | ||||||||||||||||||||||||
Common
stock issued for cash ($0.10 per share)
|
- | - | 255,000 | 255 | 25,245 | - | (25,500 | ) | - | |||||||||||||||||||||||
In
kind contribution of services
|
- | - | - | - | 593 | - | - | 593 | ||||||||||||||||||||||||
Net
loss for the period July 9, 2007 (Inception) to September 30,
2007
|
- | - | - | - | - | (16,593 | ) | - | (16,593 | ) | ||||||||||||||||||||||
Balance,
September 30, 2007
|
- | - | 5,255,000 | 5,255 | 25,838 | (16,593 | ) | (25,500 | ) | (11,000 | ) | |||||||||||||||||||||
Common
stock issued for cash ($0.10 per share)
|
- | - | 1,115,000 | 1,115 | 110,385 | - | - | 111,500 | ||||||||||||||||||||||||
Cash
received for subscription receivable
|
- | - | - | - | - | - | 25,500 | 25,500 | ||||||||||||||||||||||||
In
kind contribution of services
|
- | - | - | - | 2,600 | - | - | 2,600 | ||||||||||||||||||||||||
Net
loss for the year ended September 30, 2008
|
- | - | - | - | - | (127,900 | ) | - | (127,900 | ) | ||||||||||||||||||||||
Balance,
September 30, 2008
|
- | - | 6,370,000 | 6,370 | 138,823 | (144,493 | ) | - | 700 | |||||||||||||||||||||||
In
kind contribution of services
|
- | - | - | - | 2,600 | - | - | 2,600 | ||||||||||||||||||||||||
Forgiveness
of a third party account payable
|
- | - | - | - | 5,000 | - | - | 5,000 | ||||||||||||||||||||||||
Net
loss for the year ended September 30, 2009
|
- | - | - | - | - | (40,718 | ) | - | (40,718 | ) | ||||||||||||||||||||||
Balance,
September 30, 2009
|
- | - | 6,370,000 | 6,370 | 146,423 | (185,211 | ) | - | (32,418 | ) | ||||||||||||||||||||||
In
kind contribution of services
|
- | - | - | - | 2,600 | - | - | 2,600 | ||||||||||||||||||||||||
Net
loss for the year ended September 30, 2010
|
- | - | - | - | - | (90,826 | ) | - | (90,826 | ) | ||||||||||||||||||||||
Balance,
September 30, 2010
|
- | $ | - | 6,370,000 | $ | 6,370 | $ | 149,023 | $ | (276,037 | ) | $ | - | $ | (120,644 | ) | ||||||||||||||||
In
kind contribution of services
|
- | - | - | - | 650 | - | - | 650 | ||||||||||||||||||||||||
Net
loss for the three months ended December 31, 2010
|
- | - | - | - | - | (22,333 | ) | - | (22,333 | ) | ||||||||||||||||||||||
Balance,
December 31, 2010
|
- | $ | - | 6,370,000 | $ | 6,370 | $ | 149,673 | $ | (298,370 | ) | $ | - | $ | (142,327 | ) |
See accompanying notes to condensed unaudited
financial statements.
6
(A
Development Stage Company)
Condensed
Statements of Cash Flows
(Unaudited)
For
the Three Months Ended
|
For
the Period from July 9, 2007
|
|||||||||||
December
31, 2010
|
December
31, 2009
|
(Inception)
to December 31, 2010
|
||||||||||
Cash
Flows Used in Operating Activities:
|
||||||||||||
Net
Loss
|
$ | (22,333 | ) | $ | (37,807 | ) | $ | (298,370 | ) | |||
Adjustments
to reconcile net loss to net cash used in operations
|
||||||||||||
In-kind
contribution of services
|
650 | 650 | 9,043 | |||||||||
Shares
issued to founder for services
|
- | - | 5,000 | |||||||||
Changes
in operating assets and liabilities:
|
||||||||||||
Increase
in accounts payable and accrued expenses
|
9,222 | 30,591 | 23,452 | |||||||||
Increase
in accrued interest payable
|
2,772 | 1,134 | 10,596 | |||||||||
Net
Cash Used In Operating Activities
|
(9,689 | ) | (5,432 | ) | (250,279 | ) | ||||||
Cash
Flows From Financing Activities:
|
||||||||||||
Proceeds
from note payable
|
- | - | 69,585 | |||||||||
Repayment
of loan payable
|
- | - | (4,585 | ) | ||||||||
Proceeds
from loan payable- Related party
|
- | - | 1,100 | |||||||||
Repayment
of loan payable - Related party
|
- | - | (1,100 | ) | ||||||||
Proceeds
from convertible note payable
|
- | - | 50,000 | |||||||||
Proceeds
from issuance of common stock
|
- | - | 137,000 | |||||||||
Net
Cash Provided by Financing Activities
|
- | - | 252,000 | |||||||||
Net
Increase/(Decrease) in Cash
|
(9,688 | ) | (5,432 | ) | 1,721 | |||||||
Cash
at Beginning of Period
|
11,410 | 22,545 | - | |||||||||
Cash
at End of Period
|
$ | 1,721 | $ | 17,113 | $ | 1,721 | ||||||
Supplemental
disclosure of cash flow information:
|
||||||||||||
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
Cash
paid for taxes
|
$ | - | $ | - | $ | 120 | ||||||
Supplemental
disclosure of non-cash investing and financing
activities:
|
||||||||||||
Forgiveness
of Related Accounts Payable
|
$ | - | $ | - | $ | 5,000 |
See
accompanying notes to condensed unaudited financial statements.
7
MAX
CASH MEDIA, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31,
2010
(UNAUDITED)
NOTE
1
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES AND
ORGANIZATION
|
(A) Basis of
Presentation
The
accompanying unaudited condensed financial statements have been prepared in
accordance with accounting principles generally accepted in The United States of
America and the rules and regulations of the Securities and Exchange Commission
for interim financial information. Accordingly, they do not include
all the information necessary for a comprehensive presentation of financial
position and results of operations.
It is
management's opinion, however, that all material adjustments (consisting of
normal recurring adjustments) have been made which are necessary for a fair
financial statements presentation. The results for the interim period
are not necessarily indicative of the results to be expected for the
year.
Max Cash
Media, Inc. (a development stage company) (the "Company") was incorporated under
the laws of the State of Nevada on July 9, 2007, with the intention of acquiring
and marketing intellectual properties within the entertainment
industry. The Company conducted minimal operations in this line of
business and has since decided to discontinue operations in this
area. The Company is presently inactive, but is looking at ventures
of merit for corporate participation as means of enhancing shareholder
value.
(B) Use of
Estimates
In
preparing financial statements in conformity with accounting principles
generally accepted in the United States of America, management is required to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and revenues and expenses during the reported
period. Actual results could differ from those
estimates.
(C) Cash and Cash
Equivalents
The
Company considers all highly liquid temporary cash investments with an original
maturity of three months or less to be cash equivalents. At December
31, 2010 and September 30, 2010, the Company had no cash
equivalents.
(D) Loss Per
Share
Basic and
diluted net loss per common share is computed based upon the weighted average
common shares outstanding as defined by FASB Accounting Standards Codification
Topic 260, “Earnings Per Share.” As of December 31, 2010 and 2009
there were no common share equivalents outstanding.
8
MAX
CASH MEDIA, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31,
2010
(UNAUDITED)
(E) Income
Taxes
The
Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC
740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities
are recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. Under ASC 740-10-25, the effect on deferred tax
assets and liabilities from a change in tax rates is recognized in income in the
period that includes the enactment date.
(F) Business
Segments
The
Company operates in one segment and therefore segment information is not
presented.
(G) Revenue
Recognition
The
Company will recognize revenue on arrangements in accordance with FASB ASC No.
605, “Revenue Recognition”. In all cases, revenue is recognized only
when the price is fixed and determinable, persuasive evidence of an arrangement
exists, the service is performed and collectability of the resulting receivable
is reasonably assured.
(H)
Reclassification
Certain
amounts from prior period have been reclassified to conform to the current
period presentation.
(I) Fair Value of Financial
Statements
The
carrying amounts reported in the balance sheet for accounts payable, accrued
expenses, convertible note payable and note payable approximate fair value based
on the short-term maturity of these instruments.
9
MAX
CASH MEDIA, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31,
2010
(UNAUDITED)
NOTE
2
|
STOCKHOLDERS’
EQUITY
|
(A) Common Stock Issued for
Cash
During
October 2007, the Company issued 1,115,000 shares of common stock for $111,500
($0.10/share).
During
October 2007, the Company collected $25,500 ($0.10/share) for the sale of
255,000 shares of common stock made during the period from July 9, 2007
(inception) through September 30, 2007.
(B) In-Kind
Contribution
For the
three months ended December 31, 2010, a shareholder of the Company contributed
services having a fair value of $650 (See Note 7).
During
the year ended September 30, 2009, a related party forgave accounts payable in
the amount of $5,000 for services provided. The payable was
reclassified to additional paid in capital as an in kind contribution of
services (See Notes 3, 6 and 7).
For the
year ended September 30, 2010, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 7).
For the
year ended September 30, 2009, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 7).
For the
year ended September 30, 2008, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 7).
For the
year ended September 30, 2007 a shareholder of the Company contributed services
having a fair value of $593. (See Note 7)
(C) Stock Issued for
Services
On July
9, 2007, the Company issued 5,000,000 shares of common stock to its founder
having a fair value of $5,000 ($0.001/share) in exchange for services provided
(See Note 7).
NOTE
3
|
FORGIVENESS
OF A PAYABLE
|
During
the year ended September 30, 2009, a related party forgave accounts payable in
the amount of $5,000 for services provided. The payable was
reclassified to additional paid in capital as an in kind contribution of
services (See Notes 2(B), 6 and 7).
10
MAX
CASH MEDIA, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31,
2010
(UNAUDITED)
NOTE
4
|
LOAN
PAYABLE
|
On May
10, 2010, the Company issued a promissory note in the amount of $65,000 due
November 9, 2011 and bearing interest at a rate of 10% per annum.
During
2009, the Company owed $4,585 to an unrelated third party for expenses paid on
behalf of the Company. The loan was repaid in full during August
2009.
For the
year ended September 30, 2007, the Company received $1,100 from a principal
stockholder. Pursuant to the terms of the loan, the loan is non interest
bearing, unsecured and due on demand. The loan was repaid on October
23, 2007 (See Note 7).
NOTE
5
|
CONVERTIBLE
NOTE PAYABLE
|
On July
29, 2009, the Company issued a convertible promissory note in the amount of
$50,000due January 28, 2011 and bearing interest at a rate of 9% per annum. On
January 28, 2011 the Company extended the due date of the note to July 27,
2012. All debt can be converted into shares at a conversion
price to be mutually determined by the Company and the holder of the note (See
Note 9).
NOTE
6
|
COMMITMENTS
|
On
October 15, 2007, the Company entered into a consulting agreement with a related
party to receive administrative and other miscellaneous services. The
Company is required to pay $7,500 a month. The agreement was to
remain in effect unless either party desired to cancel the
agreement. This agreement has been terminated as of July 31,
2008. In addition, the payment due for the month of July has been
reduced to $5,000 by mutual agreement of both parties. Effective
December 31, 2008, the amount of $5,000 was forgiven (See Notes 2(B), 3 and
7).
NOTE
7
|
RELATED
PARTY TRANSACTIONS
|
For the
three months ended December 31, 2010, a shareholder of the Company contributed
services having a fair value of $650 (See Note 2(B)).
For the
year ended September 30, 2010, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 2(B)).
11
MAX
CASH MEDIA, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO CONDENSED FINANCIAL STATEMENTS
AS OF DECEMBER 31,
2010
(UNAUDITED)
For the
year ended September 30, 2009, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 2(B)).
For the
year ended September 30, 2008, a shareholder of the Company contributed services
having a fair value of $2,600 (See Note 2(B)).
During
the year ended September 30, 2009, a related party forgave accounts payable in
the amount of $5,000 for services provided. The payable was
reclassified to additional paid in capital as an in kind contribution of
services (See Notes 2(b) and 6).
For the
year ended September 30, 2007, the Company received $1,100 from a principal
stockholder. Pursuant to the terms of the loan, the loan is non interest
bearing, unsecured and due on demand. The loan was repaid on October
23, 2007 (See Note 4).
For the
year ended September 30, 2007, a shareholder of the Company contributed services
having a fair value of $593 (See Note 2(B)).
On July
9, 2007, the Company issued 5,000,000 shares of common stock to its founder
having a fair value of $5,000 ($0.001/share) in exchange for services provided
(See Note 2(c)).
NOTE
8
|
GOING
CONCERN
|
As
reflected in the accompanying unaudited condensed financial statements, the
Company is in the development stage and has accumulated losses of $298,370 and a
negative cash flow from operations of $250,279 since inception. In
addition, the Company has a stockholders’ deficiency of $142,327 and
a working capital deficiency of $92,327 as of December 31,
2010. This raises substantial doubt about its ability to continue as
a going concern. The ability of the Company to continue as a going
concern is dependent on the Company’s ability to raise additional capital and
implement its business plan. The financial statements do not include
any adjustments that might be necessary if the Company is unable to continue as
a going concern.
Management
believes that actions presently being taken to obtain additional funding and
implement its strategic plans provide the opportunity for the Company to
continue as a going concern.
NOTE
9
|
SUBSEQUENT
EVENT
|
On
January 28, 2011, the Company extended the due date of the $50,000 convertible
promissory note to July 27, 2012. The interest rate of 9% per
annum remained the same (See Note 5).
12
ITEM
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
Statement
Regarding Forward-Looking Information
This
report contains forward-looking statements. All statements other than statements
of historical facts included in this Quarterly Report on Form 10-Q, including
without limitation, statements in this Management’s Discussion and Analysis of
Financial Condition and Results of Operations regarding our financial position,
estimated working capital, business strategy, the plans and objectives of our
management for future operations and those statements preceded by, followed by
or that otherwise include the words “believe,” “expects,” “anticipates,”
“intends,” “estimates,” “projects,” “target,” “goal,” “plans,” “objective,”
“should,” or similar expressions or variations on such expressions are
forward-looking statements. We can give no assurances that the assumptions upon
which the forward-looking statements are based will prove to be correct. Because
forward-looking statements are subject to risks and uncertainties, actual
results may differ materially from those expressed or implied by the
forward-looking statements.
Actual
operations and results may materially differ from present plans and projections
due to changes in economic conditions, new business opportunities, changed
business conditions, and other developments. Other factors that could cause
results to differ materially are described in our filings with the
Securities and Exchange Commission.
The
following are factors that could cause actual results or events to differ
materially from those anticipated, and include, but are not limited to
a general economic, financial and business conditions, changes in and
compliance with governmental laws and regulations, including various state and
federal environmental regulations, our ability to obtain additional financing
from outside investors and/or bank and mezzanine lenders; and our ability to
generate sufficient revenues to cover operating losses and position us to
achieve positive cash flow.
Readers
are cautioned not to place undue reliance on the forward-looking statements
contained herein, which speak only as of the date hereof. We believe the
information contained in this Form 10-Q to be accurate as of the date hereof.
Changes may occur after that date. We will not update that information except as
required by law in the normal course of its public disclosure
practices.
Additionally,
the following discussion regarding our financial condition and results of
operations should be read in conjunction with the financial statements and
accompanying notes included in Item 1 of Part I of this Quarterly Report on Form
10-Q and with the
Management’s Discussion and Analysis of Financial Condition and Results of
Operations and the financial statements and accompanying notes included our
Annual Report on Form 10-K for the fiscal year ended September 30, 2010, filed
with the Securities and Exchange Commission.
13
Limited
Operating History
We were
incorporated in the State of Nevada on July 9, 2007, with the intention of
acquiring and marketing intellectual properties within the entertainment
industry. We conducted minimal operations in this line of business
and have since decided to discontinue operations in this area. We are
presently inactive, but we are looking at ventures of merit for corporate
participation as means of enhancing shareholder value. This may
involve sales of our equity or debt securities in merger or acquisition
transactions.
Material
Changes in Results of Operations
We have
not generated any revenues from operations for the period from July 9, 2007
(date of inception) through December 31, 2010.
Three Months Ended December 31,
2010
We
incurred an operating loss of $19,562 for the three month period ended December
31, 2010, compared to an operating loss of $36,675 for the three month period
ended December 31, 2009. The decrease in operating loss for the three
month period ended December 31, 2010 was mainly due to decreased professional
fees related to our financial reporting obligations, partially offset by higher
general and administrative expenses.
Net loss
for the three-month period ended December 31, 2010 was $22,333, compared to a
net loss of $37,807 for the three-month period ended December 31,
2009. Expenses in the three-month period ended December 31,
2010 were comprised of professional fees of $17,374, general and administrative
expenses of $2,188, and interest expenses of $2,773.
Interest
expenses related to the promissory notes that we issued on July 29, 2009 and May
10, 2010 were $2,773 for the three months ended December 31,
2010. The convertible promissory note issued on July 29, 2009 is in
the principal amount of $50,000, it bears interest at an annual rate of 9%, it
is due on July 27, 2012, and it may be converted into shares of our common stock
at a conversion price per share to be agreed by the Company and the note
holder. The promissory note issued on May 10, 2010 is in the
principal amount of $65,000, it bears interest at an annual rate of 10% and it
is due on November 9, 2011.
Period
from Inception to December 31, 2010
We
incurred an operating loss of $288,661 for the period from July 9, 2007
(inception) through December 31, 2010, and we have not generated any operating
revenues since inception. We anticipate that we will not generate any
operating revenues until we are able to raise additional capital to fund our
operations.
Net
losses for the period from July 9, 2007 (inception) through December 31, 2010
amounted to $298,370. Expenses in that period were comprised of
professional fees of $243,301, general and administrative expenses of $45,360,
and interest expenses of $10,597.
14
Liquidity
and Capital Resources
Since our
inception, we have been financed primarily by loans and private placements of
our common stock. We raised $25,500 from July 9, 2007 (inception)
through September 30, 2007 and $111,500 in October 2007 from sales of common
stock. The total net funds raised of $252,000 since inception through
December 31, 2010 have been used principally as follows: (a) $45,360 in general
and administrative expenses, and (b) $243,301 in professional fees in connection
with the filing of a registration statement and our financial reporting
requirements. At December 31, 2010, we had available cash balances of
$1,721 which are held in interest bearing bank accounts.
As
reflected in the accompanying unaudited condensed financial statements, we
are in the development stage with no operations, we have used net cash in
operations of $250,279 from inception, and have a net loss since inception of
$298,370. The Company also has a working capital deficiency of $92,327 and a
stockholders’ deficiency of $142,327 as of December 31,
2010. This raises substantial doubt about our ability to
continue as a going concern. Our ability to continue as a going concern is
dependent on our ability to raise additional capital and implement our business
plan. The financial statements do not include any adjustments that might be
necessary if we are unable to continue as a going concern.
We
presently do not have any available credit, bank financing or other external
sources of liquidity. Due to our brief history and historical operating losses,
our operations have not been a source of liquidity. We believe that, at our
current level of operation, we do not have sufficient cash to meet our expenses
for the next twelve months. We expect that we will need to obtain additional
capital in order to maintain our public company regulatory requirements and
execute our business plan. In order to obtain capital, we may need to sell
additional shares of our common stock or debt securities, or borrow funds from
private lenders or banking institutions. We have not made any decisions with
respect to any such financing. There can be no assurance that we will
be successful in obtaining additional funding in amounts or on terms acceptable
to us, if at all. If we are unable to raise additional funding as necessary, we
may have to suspend our operations temporarily or cease operations
entirely.
Critical Accounting
Policies
Our
financial statements and related public financial information are based on the
application of accounting principles generally accepted in the United States
(“GAAP”). GAAP requires the use of estimates; assumptions, judgments and
subjective interpretations of accounting principles that have an impact on the
assets, liabilities, revenues and expense amounts reported. These estimates can
also affect supplemental information contained in our external disclosures
including information regarding contingencies, risk and financial condition. We
believe our use of estimates and underlying accounting assumptions adhere to
GAAP and are consistently and conservatively applied. We base our estimates on
historical experience and on various other assumptions that we believe to be
reasonable under the circumstances. Actual results may differ materially from
these estimates under different assumptions or conditions. We continue to
monitor significant estimates made during the preparation of our financial
statements.
Our
significant accounting policies are summarized in Note 1 of our financial
statements. While all these significant accounting policies impact our
financial condition and results of operations, we view certain of these policies
as critical. Policies determined to be critical are those policies that have the
most significant impact on our financial statements and require management to
use a greater degree of judgment and estimates. Actual results may differ from
those estimates. Our management believes that given current facts and
circumstances, it is unlikely that applying any other reasonable judgments or
estimate methodologies would cause effect on our results of operations,
financial position or liquidity for the periods presented in this
report.
15
Off Balance Sheet
Transactions
None.
Item
3. Quantitative and Qualitative Disclosures About Market Risk
Not
applicable.
Item
4. Controls and Procedures
Evaluation
of Disclosure Controls and Procedures
Disclosure
controls and procedures include, without limitation, controls and procedures
designed to ensure that information required to be disclosed by an issuer in the
reports that it files or submits under the Exchange Act of 1934 (the “Exchange
Act”) is accumulated and communicated to the issuer's management, including its
principal executive and principal financial officers, or persons performing
similar functions, as appropriate to allow timely decisions regarding required
disclosure. It should be noted that the design of any system of controls is
based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions, regardless of how
remote.
The
management of Max Cash Media, Inc. is responsible for establishing and
maintaining an adequate system of internal control over financial reporting (as
defined in Rule 13a-15(f) under the Exchange Act). Under the supervision and
with the participation of our senior management, consisting of Noah Levinson,
our Chief Executive and Financial Officer, we conducted an evaluation of the
effectiveness of the design and operation of our disclosure controls and
procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act
as of the end of the period covered by this report (the “Evaluation Date”).
Based on this evaluation, our chief executive and financial officer concluded,
as of the Evaluation Date, that our disclosure controls and procedures were not
effective because of the identification of what might be deemed a material
weakness in our internal control over financial reporting which is identified
below.
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. In evaluating the effectiveness of our internal control over
financial reporting, 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 sole officer concluded that, during the period covered
by this quarterly report, our internal controls over financial reporting were
not operating effectively. Management did not identify any material weaknesses
in our internal control over financial reporting as of December 31, 2010;
however, it has identified the following deficiencies that, when aggregated, may
possibly be viewed as a material weakness in our internal control over financial
reporting as of that date:
16
|
1.
|
We
do not have an audit committee. While we are not currently obligated to
have an audit committee, including a member who is an “audit committee
financial expert,” as defined in Item 407 of Regulation S-K, under
applicable regulations or listing standards; however, it is management’s
view that such a committee is an important internal control over financial
reporting, the lack of which may result in ineffective oversight in the
establishment and monitoring of internal controls and
procedures.
|
|
2.
|
We
did not maintain proper segregation of duties for the preparation of our
financial statements. We currently only have one officer overseeing all
transactions. This has resulted in several deficiencies including the lack
of control over preparation of financial statements, and proper
application of accounting policies:
|
Management
believes that the material weaknesses set forth the two items above did not have
an effect on our financial results. However, management believes that the lack
of a functioning audit committee and the lack of a majority of outside directors
on our Board of Directors results in ineffective oversight in the establishment
and monitoring of required internal controls and procedures, which could result
in a material misstatement in our financial statements in future
periods.
Management's
Remediation Initiatives
In an
effort to remediate the identified material weaknesses and other deficiencies
and enhance our internal controls, we plan to initiate the following series of
measures once we have the financial resources to do so:
We will
create a position to segregate duties consistent with control objectives and
will increase our personnel resources and technical accounting expertise within
the accounting function when funds are available to us. And, we plan to appoint
one or more outside directors to our board of directors who shall be appointed
to an audit committee resulting in a fully functioning audit committee who will
undertake the oversight in the establishment and monitoring of required internal
controls and procedures such as reviewing and approving estimates and
assumptions made by management when funds are available to us.
Management
believes that the appointment of one or more outside directors, who shall be
appointed to a fully functioning audit committee, would remedy the lack of a
functioning audit committee and a lack of a majority of outside directors on our
Board.
17
Changes in internal control over
financial reporting.
There
have been no changes in our internal control over financial reporting that
occurred during the last fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
PART II – OTHER
INFORMATION
Item
1. Legal Proceedings.
Currently
we are not aware of any litigation pending or threatened by or against the
Company.
Item
1A. Risk Factors
Not
applicable.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds
We issued
no equity securities during the quarter ended December 31, 2010.
Item
3. Defaults Upon Senior Securities.
None.
Item
4. (Removed and Reserved)
Item
5. Other Information.
None.
Item
6. Exhibits.
31.1
|
Certification
of Principal Executive Officer and Financial Officer pursuant to Section
302 of the Sarbanes Oxley Act of
2002
|
32.1
|
Certification
of Chief Executive Officer and Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002
|
18
SIGNATURES
Pursuant
to the requirements 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.
February
7, 2011
|
MAX CASH MEDIA, INC. | |
By:
|
/s/
Noah Levinson
|
|
Noah
Levinson, Chief Executive Officer and
Chief
Financial
Officer
|
19