U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM - 10Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15
(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934
For the quarterly period ended February 28, 2011.
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934 For the transition
period from _____________________
Commission File No:000-51976
MONZA VENTURES INC.
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(Name of small business issuer in its charter)
NEVADA
N/A
(State of Incorporation) (I.R.S. Employer Identification No.)
1018 HUGUANG RD., CHANG CHUN, CHINA,
130012
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(Address of principal executive offices)
949-419-6588
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(Registrant's telephone number,
including area code)
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(Former name, address and fiscal year, if changed since last report)
Indicate by check mark whether the issuer (1) filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during
the past 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 o
Indicate by check mark whether the registrant is a large accelerated
filer,
an accelerated filer, a non-accelerated filer,or a smaller reporting
company.
Large accelerated filer " Accelerated filer "
Non-accelerated filer " Smaller reporting company X
Indicate by check mark whether the registrant is a shell company (as
defined in rule 12b-2 of the Exchange Act)? Yes x No "
The number of shares outstanding of the registrant's common stock, par
value $.001 per share, as of April 14, 2011 was 22,754,795
shares .
Page 1
MONZA VENTURES INC.
INDEX TO FORM 10-Q FILING
FOR THE THREE AND NINE MONTHS ENDED February 28, 2011 AND February 28, 2010
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Balance Sheets 2
Statements of Operations 3
Statement of Cash Flows 4
Notes to Financial Statements 5
Item 2. Management Discussion & Analysis of
Financial Condition and Results of
Operations 9
Item 3 Quantitative and Qualitative Disclosures
About Market Risk 11
Item 4. Controls and Procedures 12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 1A Risk Factors 14
Item 2. Unregistered Sales of Equity Securities
and Use of Proceeds 20
Item 3. Defaults Upon Senior Securities 20
Item 4. Removed and Reserved 20
Item 5 Other information 20
Item 6. Exhibits 22
CERTIFICATIONS
Exhibit 31 Management certification 22-24
Exhibit 32 Sarbanes-Oxley Act 22-24
Page 2
Monza Ventures Inc.
(A Development Stage Company)
Balance Sheets
As at February 28, 2011 and November 30, 2010
February 28, 2011 November 30, 2010
(Unaudited) (Audited)
Assets
Current Assets - Cash and Cash Equivalents $48 $48
Website Development Costs - -
TOTAL ASSETS $48 $48
Liabilities
Current Liabilities
Accounts Payable and Accrued Liabilities- $16,748 $16,748
Related Party
Dues from Related Parties $41,000 $41,000
Loan from Related Party $45,907 $45,907
TOTAL CURRENT LIABILITIES $103,655 $103,655
Stockholders' Equity - Common Stock
$0.001 par value, 75,000,000 shares 10,500 10,500
authorized, 73,500,000 and 10,500,000
shares issued and outstanding as of
November 30, 2010 and 2009, respectively
Additional paid-in capital 25,240 24,373
Deficit accumulated during the developmental stage $(139,347) $(138,480)
TOTAL STOCKHOLDERS' EQUITY $(103,607) $(103,607)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $48 $48
The accompanying notes are an integral part of these financial
statements
Page 3
Monza Ventures Inc.
(A Development Stage Company)
Statements of Operations
THREE MONTHS ENDED FEBRUARY 28, 2011 AND 2010 AND THE
PERIOD FROM SEPTEMBER 6, 2005 (INCEPTION) THROUGH FEBRUARY 28, 2011
(Unaudited)
Three Months Three Months From September
Ended February Ended February 6, 2005
28, 2011 28, 2010 (Inception) to
February 28, 2011
General and
Administrative
Expenses
Filing Fees - $124 $3,403
Rent - - $53,000
Bank Charges - - $1,129
Professional Fees - $1,230 $65,026
Interest Expense $867 - $11,740
Website - - $5,000
Development
Office Expense - - $50
Operating loss $(867 $(1,354) $(139,347)
Net (loss) for $(867) $(1,354) $(139,347)
the period
Net (loss) per 0.00 0.00
share - Basic
and Diluted
Weighted Average 22,754,795 10,500,000
Shares
Outstanding -
Basic and Diluted
The accompanying notes are an integral part of these
financial statements.
MONZA VENTURES INC.
(A Development Stage Company)
Statement of Cash Flows
Page 4
Three Months Ended February 28, 2011
and 2010 and the Period From
September 6, 2005 (Inception)
through February 28, 2011
(Unaudited)
For For From
the the September
Three Three 6,
Months Months 2005
Ended Ended (Inception)
February February to
28 ,2011 28, 2010 February
28, 2011
Cash Flow from Operating Activities
Net loss for the Period $(867) $(1,354) $(139,347)
Imputed interest $867 - $11,740
on related party transactions
Changes in non-cash working
capital items
Accounts payable and - $1,250 $57,748
accrued liabilities
Net Cash Flow Used in - $(104) $(69,859)
Operating Activities
Financing Activities
Advances from related party - - $45,907
Issuance of common - - $24,000
stock
Net Cash Flow Provided by - - $69,907
Financing Activities
Net change in Cash - $(104) $48
Cash, Beginning of Period $48 $333 -
Cash, End of Period $48 $229 $48
The accompanying notes are an
integral part of these financial
statements
Page 5
Monza Ventures Inc.
(A Development Stage Company)
Notes to the Financial Statements
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company is a development stage company which was incorporated in
the State of Nevada on September 6, 2005. The Company intends to
commence operations as an e commerce retailer of overstock items
through a website on the internet.
Basis of Presentation
The Company follows accounting principles generally accepted in the
United States of America. In the opinion of management, all
adjustments, consisting of normal recurring adjustments, necessary
for a fair presentation of financial position and the results of
operations for the periods presented have been reflected herein.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principle requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of
the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ
from those estimates.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers
all highly liquid investments purchased with an original maturity
of three months or less to be cash equivalents. As of February 28,
2011 and 2010, there were no cash equivalents.
Development Stage Company
The Company complies with the FASB Accounting Standards Codification
(ASC) Topic 915 Development Stage Entities
Impairment of Long Lived Assets
Long-lived assets are reviewed for impairment in accordance with ASC
Topic 360, "Accounting for the Impairment or Disposal of Long- lived
Assets". Under ASC Topic 360, long-lived assets are tested for
recoverability whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable. An impairment
charge is recognized or the amount, if any, which the carrying value
of the asset exceeds the fair value.
Page 6
Income Taxes
Monza uses the liability method of accounting for income taxes pursuant
to FASB Topic 740. Under this method, deferred income taxes are
recorded to reflect the tax consequences in future years of temporary
differences between the tax basis of the assets and liabilities and their
financial amounts at year end.
Basic and Diluted Net Loss Per Share
Basic earnings per common share is computed based upon the weighted
average number of common shares outstanding during the period. Diluted
earnings per share consists of the weighted average number of common
shares outstanding plus the dilutive effects of options and warrants
calculated using the treasury stock method. In loss periods, dilutive
common equivalent shares are excluded as the effect would be anti-dilutive.
At February 28, 2011, no equivalents existed because the effect would
be anti-dilutive.
Website Development Cost
The Company adopted EITF 00-2, "Accounting for Website Development Costs,
" which specifies the appropriate accounting for costs incurred in
connection with the development and maintenance of websites. Under the
EITF 00-2, website development costs are capitalized when acquired and
installed, and are being amortized over its estimated useful life. On
November 15, 2005, the Company entered into a web design contract. The
company accrued and paid $5,000 website development cost and has not
recorded an amortization of the website development costs as the initial
installation of the website has not yet completed as of February 28, 2011.
Stock Based Compensation
The Company accounts for stock-based employee compensation arrangements
using the fair value method in accordance with the provisions of ASC Topic
718 Compensation-Stock Compensation. The company accounts for the stock
options issued to non-employees in accordance with the provisions of ASC
Topic 718 Compensation- Stock Compensation.
Page 7
The Company did not grant any stock options or warrants during the period
from inception to February 28, 2011.
Revenue Recognition
Revenue is recognized when it is realized or realizable and earned. Monza
considers revenue realized or realizable and earned when pervasive
evidence of an arrangement exists, services have been provided, and
collectability is reasonably assured. Revenue that is billed in advance
such as recurring weekly or monthly services are initially deferred and
recognized as revenue over the periods the services are provided.
Advertising Expenses
The company expenses advertising costs as incurred. There was no advertising
expense incurred by the company during the period ended February 28, 2011
and 2010.
New Accounting Standards
Monza does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on its results of operations,
financial position or cash flow.
NOTE 2 GOING CONCERN
Monza's financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and settlement of liabilities
and commitments in the normal course of business for the foreseeable future.
Since inception, the Company has accumulated losses aggregating to $139,347
and has insufficient working capital to meet operating needs for the next
twelve months as of February 28, 2011, all of which raise substantial doubt
about Monza's ability to continue as a going concern.
NOTE 3 CAPITAL STOCK
On September 9, 2005, the Company issued 5,000,000 common shares at $0.001
per share to the sole director of the Company for total proceeds of $5,000.
On September 12, 2005, the Company issued 4,000,000 common shares at $0.001
per share for total proceeds of $4,000.
On September 13, 2005, the Company issued 1,500,000 common shares at $0.01
per share for total proceeds of $15,000.
On September 20, 2010, the Stockholder's of the Company authorized the Forward
Stock Split of our issued and outstanding Common Stock on a seven for one
(7:1) basis.The Forward Stock Split became effective on September 20, 2010.
As a result of the Forward Stock Split, the Company increased its issued
and outstanding shares of the Common Stock to 73,500,000 from 10,500,000.
NOTE 4 INCOME TAXES
As of February 28, 2011, the Company has an estimated net operating loss
carryforward for tax purpose of $139,347. This amount may be applied against
future federal taxable income and expires in 2028.
Page 8
As management of the Company cannot determine that it is more likely than not
that the Company will realize the benefit of the deferred tax asset, a
valuation allowance equal to the deferred tax asset has been established as
at November 30, 2010 and 2009. The significant components of the deferred tax
asset as at November 30, 2010 and 2009 are as follows:
2010 2009
Net Operating loss carryfowards $ 48,468 $ 21,196
Valuation allowance (48,468) (21,196)
Net Deferred Tax asset $ - $ -
NOTE 5 RELATED PARTY TRANSACTIONS
As of February 28, 2011 and 2010, $45,907 and $45,907, respectively of accounts
payable is payable to a company controlled by a person related to the former
director of the company.
A shareholder loaned the Company $8,700 as of February 28, 2011. Imputed
interest in the amount of $867 is included in additional paid in capital for
the three months ended February 28, 2011.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Management's Discussion and Analysis contains various "forward looking
statements" within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended, regarding future events or the future
financial performance of the Company that involve risks and
uncertainties. Certain statements included in this Form 10-Q,
including, without limitation, statements related to anticipated cash
flow sources and uses, and words including but not limited to
"anticipates", "believes", "plans", "expects", "future" and similar
statements or expressions, identify forward looking statements. Any
forward-looking statements herein are subject to certain risks and
uncertainties in the Company's business, including but not limited to,
reliance on key customers and competition in its markets, market
demand, product performance, technological developments, maintenance of
relationships with key suppliers, difficulties of hiring or retaining
key personnel and any changes in current accounting rules, all of which
may be beyond the control of the Company. The Company adopted at
management's discretion, the most conservative recognition of revenue
based on the most astringent guidelines of the SEC in terms of
recognition of software licenses and recurring revenue. Management will
elect additional changes to revenue recognition to comply with the most
conservative SEC recognition on a forward going accrual basis as the
model is replicated with other similar markets (i.e. SBDC). The
Company's actual results could differ materially from those anticipated
in these forward-looking statements as a result of certain factors,
including those set forth therein.
Forward-looking statements involve risks, uncertainties and other
factors, which may cause our actual results, performance or
achievements to be materially different from those expressed or implied
Page 9
by such forward-looking statements. Factors and risks that could affect
our results and achievements and cause them to materially differ from
those contained in the forward-looking statements include those
identified in the section titled "Risk Factors" in the Company's Annual
Report on Form 10-K for the year ended November 30, 2010 as well as
other factors that we are currently unable to identify or quantify, but
that may exist in the future.
In addition, the foregoing factors may affect generally our business,
results of operations and financial position. Forward-looking
statements speak only as of the date the statement was made. We do not
undertake and specifically decline any obligation to update any
forward-looking statements.
Cash Requirements
Monza Ventures Inc. was incorporated in the state of Nevada on
September 6, 2005. We intend to commence operations as an e-commerce
retailer which will offer for sale overstocked inventory items from
factories in China over the internet. The initial region we plan to
market our website to is North America. We currently have signed a
contract with a Canadian business development firm to create and
develop our website. We expect that our website will reach the beta
phase of development by the end of December 2011. We currently have not
advanced beyond the business plan state from our inception until the
date of this filing. In order for us to begin commercialization of our
product, we will need to raise additional capital.
We currently have not advanced beyond the business plan state from our
inception until the date of this filing. From inception until the date
of this filing, we have had no material operating activities. Our
current cash balance is $48. We anticipate that our current cash
balance will not satisfy our cash needs for the following twelve-month
period. There can be no assurance that we will be successful in finding
financing, or even if financing is found, that we will be successful in
proceeding with profitable operations.
Not accounting for our working capital deficit of $103,607, we require
additional funds of approximately $25,000 at a minimum to proceed with
our plan of operation over the next twelve months, exclusive of any
capital investments. As we do not have the funds necessary to cover our
projected operating expenses for the next twelve month period, we will
be required to raise additional funds through the issuance of equity
securities, through loans or through debt financing. There can be no
assurance that we will be successful in raising the required capital or
that actual cash requirements will not exceed our estimates.
Our auditors have issued a going concern opinion for the year ended
November 30, 2010. This means that there is substantial doubt that we
can continue as an on-going business for the next twelve months unless
we obtain additional capital to pay our bills. This is because we have
not generated any significant revenues and no significant revenues are
Page 10
anticipated until our commercial operations begin. As we had cash in
the amount of $48 and a working capital deficit in the amount of
$103,607 as of February 28, 2011, we do not have sufficient working
capital to enable us to carry out our stated plan of operation for the
next twelve months. We will require additional funds to implement our
operations. These funds may be raised through equity financing, debt
financing, or other sources, which may result in further dilution in
the equity ownership of our shares. We currently do not have any
arrangements in place for the completion of any debt financings or
private placement financings and there is no assurance that we will be
successful in completing any debt financing or private placement
financing.
Estimated Net Expenditures During the Next Twelve Months
General and administrative $ 8,000
Rent $ 12,000
Professional fees $ 5,000
Total $ 25,000
Liquidity and Capital Resources
As of the date of this quarterly report, we have not generated any
revenues from our business activities.
As of February 28, 2011 our total assets were $48 and our total
liabilities were $103,655 and we had a working capital deficit of
$103,607. Our financial statements report a net loss of $867 for the
three months ended February 28, 2011, and a net loss of $139,347 for
the period from September 6, 2005 (date of incorporation) to February
28, 2011. Our net loss from operations decreased to $867 for the
three months ended February 28, 2011, as compared to $1,354 for the
three months ended February 28, 2010. Our losses have decreased
primarily as a result of decreased professional fees and and filing
fees.
The continuation of our business is dependent upon obtaining further
financing, a successful implementation of our business plan, and,
finally, achieving a profitable level of operations. The issuance of
additional equity securities by us could result in a significant
dilution in the equity interests of our current stockholders. Obtaining
commercial loans, assuming those loans would be available, will
increase our liabilities and future cash commitments.
There are no assurances that we will be able to obtain further funds
required for our continued operations. As noted herein, we are pursuing
various financing alternatives to meet our immediate and long-term
financial requirements.
There can be no assurance that additional financing will be available
to us when needed or, if available, that it can be obtained on
Page 11
commercially reasonable terms. If we are not able to obtain the
additional financing on a timely basis, we will be unable to conduct
our operations as planned, and we will not be able to meet our other
obligations as they become due. In such event, we will be forced to
scale down or perhaps even cease our operations.
Purchase of Significant Equipment
We do not intend to purchase any significant equipment over the six
months ending February 28, 2011.
Employees
Currently our only employees are our directors and officers. We do not
expect any material changes in the number of employees over the next 6
month period. We do and will continue to outsource contract employment
as needed.
Going Concern
We have suffered recurring losses from operations. The continuation of
our company as a going concern is dependent upon our company attaining
and maintaining profitable operations and raising additional capital.
The financial statements do not include any adjustment relating to the
recovery and classification of recorded asset amounts or the amount and
classification of liabilities that might be necessary should our
company discontinue operations.
Due to the uncertainty of our ability to meet our current operating
expenses and the capital expenses noted above, in their report on the
annual financial statements for the year ended November 30, 2010, our
independent auditors included an explanatory paragraph regarding the
substantial doubt about our ability to continue as a going concern. Our
financial statements contain additional note disclosures describing the
circumstances that lead to this disclosure by our independent auditors.
The continuation of our business is dependent upon us raising
additional financial support. The issuance of additional equity
securities by us could result in a significant dilution in the equity
interests of our current stockholders. Obtaining commercial loans,
assuming those loans would be available, will increase our liabilities
and future cash commitments.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We do not hold any derivative instruments and do not engage in any
hedging activities. Most of our activity is the development and mining
of our mining claim.
ITEM 4. CONTROLS AND PROCEDURES
Page 12
a) Evaluation of Disclosure Controls and Procedures
Our principal executive officer and our principal financial officer,
evaluated the effectiveness of the design and operation of our
disclosure controls and procedures as such term is defined under Rule
13a-15(e) promulgated under the Securities Exchange Act of 1934, as
amended (Exchange Act), as of the last day of the fiscal period covered
by this report, February 28, 2011. The term disclosure controls and
procedures means our controls and other procedures that are designed to
ensure that information required to be disclosed by us in the reports
that we file or submit under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the SEC's
rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information
required to be disclosed by us in the reports that we file or submit
under the Exchange Act is accumulated and communicated to management,
including our principal executive and principal financial officer, or
persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure. Based on this evaluation, our
principal executive officer and our principal financial officer
concluded that our disclosure controls and procedures were effective as
of February 28, 2011.
Our principal executive officer and our principal financial officer,
are responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Exchange
Act Rules 13a-15(f). Our principal executive officer and our principal
financial officer are required to base their assessment of the
effectiveness of our internal control over financial reporting on a
suitable, recognized control framework, such as the framework developed
by the Committee of Sponsoring Organizations (COSO). The COSO
framework, published in Internal Control-Integrated Framework, is known
as the COSO Report. Our principal executive officer and our principal
financial officer have chosen the COSO framework on which to base their
assessment. Based on this evaluation, our principal executive officer
and our principal financial officer concluded that our internal control
over financial reporting was effective as of February 28, 2011.
Management's report was not subject to attestation by our registered
public accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit us to provide only management's
report in our annual reports on Form 10-K for the annual reporting
periods through November 30, 2011.
It should be noted that any system of controls, however well designed
and operated, can provide only reasonable and not absolute assurance
that the objectives of the system are met. In addition, the design of
any control system is based in part upon certain assumptions about the
likelihood of certain events. Because of these and other inherent
limitations of control systems, there can be no assurance that any
design will succeed in achieving its stated goals under all potential
future conditions, regardless of how remote.
Page 13
b) Changes in Internal Control over Financial Reporting.
During the Quarter ended February 28, 2011, there was no change in our
internal control over financial reporting (as such term is defined in
Rule 13a-15(f) under the Exchange Act) that has materially affected, or
is reasonably likely to materially affect, our internal control over
financial reporting.
Page 14
PART II: OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are currently not involved in any litigation that we believe could
have a material adverse effect on our financial condition or results of
operations. There is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of
the executive officers of our company or any of our subsidiaries,
threatened against or affecting our company, our common stock, any of
our subsidiaries or of our companies or our subsidiaries' officers or
directors in their capacities as such, in which an adverse decision
could have a material adverse effect.
ITEM 1A. RISK FACTORS
ITEM 1A - Risk Factors
You should carefully consider the following risk factors together with
the other information contained in this Interim Report on Form 10-Q,
and in prior reports pursuant to the Securities Exchange Act of 1934,
as amended and the Securities Act of 1933, as amended. If any of the
following risks actually occur, our business, financial condition or
results of operations could be materially adversely affected. In such
cases, the trading price of our common stock could decline. There have
been no material changes to the risk factors previously discussed in
Item 1A of the Company's Form 10-K for the year ended November 30,
2010, including but not limited, to the following:
The Report Of Our Independent Registered Public Accounting Firm
Contains Explanatory Language That Substantial Doubt Exists About Our
Ability To Continue As A Going Concern
The Company has net losses for the period from inception (September 6,
2005) to February 28, 2011 of $134,760. The independent auditor's
report on our financial statements contains explanatory language that
substantial doubt exists about our ability to continue as a going
concern. The report states that we depend on the continued
contributions of our executive officers to work effectively as a team,
to execute our business strategy and to manage our business. The loss
of key personnel, or their failure to work effectively, could have a
material adverse effect on our business, financial condition, and
results of operations. If we are unable to obtain sufficient financing
in the near term or achieve profitability, then we would, in all
likelihood, experience severe liquidity problems and may have to
curtail our operations. If we curtail our operations, we may be placed
into bankruptcy or undergo liquidation, the result of which will
adversely affect the value of our common shares.
Page 15
We lack an operating history and have losses which we expect to
continue into the future. As a result, we may have to suspend or cease
activities.
We were incorporated in September 6, 2005 and we have not started our
proposed business activities or realized any revenues. We have no
operating history upon which an evaluation of our future success or
failure can be made. Our net loss was $134,760 from inception to
February 28, 2011. Our ability to achieve and maintain profitability
and positive cash flow is dependent upon:
* our ability to produce a successful website
* our ability to generate revenues
* our ability to reduce business costs.
Based upon current plans, we expect to incur operating losses in future
periods. This will happen because there are expenses associated with
the research and development of our web site. As a result, we may not
generate revenues in the future. Failure to generate revenues will
cause us to suspend or cease activities.
Because we will have to spend additional funds to determine if we have
a viable web site, if we can't raise the money we will have to cease
operations and you could lose your investment.
Even if we complete our current web site development and it is
successful in generating revenues, we will have to spend substantial
funds on further advertising and marketing before we will know if we
have a commercially viable web site.
Due to external market factors in the internet business, we may not be
able to viably market our web site.
The internet industry, in general, is intensely competitive. Even if a
commercially viable website is produced, we can provide no assurance to
investors that a ready market will exist for the sale of our product.
Numerous factors beyond our control may affect the marketability of our
website. The exact effect of these factors cannot be accurately
predicted, but any combination of these factors may result in our not
receiving an adequate return on invested capital.
Because our officers and directors have other outside business
activities and will only be devoting approximately five hours per week
to our operations, our operations may be sporadic which may result in
periodic interruptions or suspensions business activity.
Because our officers and directors have other outside business
activities and will only be devoting five hours per week to our
operations, our operations may be sporadic and occur at times which are
convenient to our officer and director. As a result, business activity
may be periodically interrupted or suspended.
Nevada Law And Our Articles Of Incorporation Protect Our Directors
Page 16
From Certain Types Of Lawsuits, Which Could Make It Difficult For Us To
Recover Damages From Them In The Event Of A Lawsuit.
Nevada law provides that our directors will not be liable to our
company or to our stockholders for monetary damages for all but certain
types of conduct as directors. Our Articles of Incorporation require us
to indemnify our directors and officers against all damages incurred in
connection with our business to the fullest extent provided or allowed
by law. The exculpation provisions may have the effect of preventing
stockholders from recovering damages against our directors caused by
their negligence, poor judgment or other circumstances. The
indemnification provisions may require our company to use our assets to
defend our directors and officers against claims, including claims
arising out of their negligence, poor judgment, or other circumstances.
If a market for our common stock does not develop, shareholders may be
unable to sell their shares and will incur losses as a result.
There is currently no market for our common stock and no certainty that
a market will develop. If no market is ever developed for our shares,
it will be difficult for shareholders to sell their stock. In such a
case, shareholders may find that they are unable to achieve benefits
from their investment.
Failure to achieve and maintain effective internal controls in
accordance with section 404 of the Sarbanes-Oxley act could have a
material adverse effect on our business and operating results.
It may be time consuming, difficult and costly for us to develop and
implement the additional internal controls, processes and reporting
procedures required by the Sarbanes-Oxley Act. We may need to hire
additional financial reporting, internal auditing and other finance
staff in order to develop and implement appropriate additional internal
controls, processes and reporting procedures. If we are unable to
comply with these requirements of the Sarbanes-Oxley Act, we may not be
able to obtain the independent accountant certifications that the
Sarbanes-Oxley Act requires of publicly traded companies.
If we fail to comply in a timely manner with the requirements of
Section 404 of the Sarbanes-Oxley Act regarding internal control over
financial reporting or to remedy any material weaknesses in our
internal controls that we may identify, such failure could result in
material misstatements in our financial statements, cause investors to
lose confidence in our reported financial information and have a
negative effect on the trading price of our common stock.
Pursuant to Section 404 of the Sarbanes-Oxley Act and current SEC
regulations, we will be required to prepare assessments regarding
internal controls over financial reporting and beginning with our
annual report on Form 10-K for our fiscal period ending November 30,
furnish a report by our management on our internal control over
financial reporting. We have begun the process of documenting and
testing our internal control procedures in order to satisfy these
requirements, which is likely to result in increased general and
administrative expenses and may shift management time and attention
from revenue-generating activities to compliance activities. While our
management is expending significant resources in an effort to complete
Page 17
this important project, there can be no assurance that we will be able
to achieve our objective on a timely basis. There also can be no
assurance that our auditors will be able to issue an unqualified
opinion on management's assessment of the effectiveness of our internal
control over financial reporting. Failure to achieve and maintain an
effective internal control environment or complete our Section 404
certifications could have a material adverse effect on our stock price.
In addition, in connection with our on-going assessment of the
effectiveness of our internal control over financial reporting, we may
discover "material weaknesses" in our internal controls as defined in
standards established by the Public Company Accounting Oversight Board,
or the PCAOB. A material weakness is a significant deficiency, or
combination of significant deficiencies, that results in more than a
remote likelihood that a material misstatement of the annual or interim
financial statements will not be prevented or detected. The PCAOB
defines "significant deficiency" as a deficiency that results in more
than a remote likelihood that a misstatement of the financial
statements that is more than inconsequential will not be prevented or
detected.
In the event that a material weakness is identified, we will employ
qualified personnel and adopt and implement policies and procedures to
address any material weaknesses that we identify. However, the process
of designing and implementing effective internal controls is a
continuous effort that requires us to anticipate and react to changes
in our business and the economic and regulatory environments and to
expend significant resources to maintain a system of internal controls
that is adequate to satisfy our reporting obligations as a public
company. We cannot assure you that the measures we will take will
remediate any material weaknesses that we may identify or that we will
implement and maintain adequate controls over our financial process and
reporting in the future.
Any failure to complete our assessment of our internal control over
financial reporting, to remediate any material weaknesses that we may
identify or to implement new or improved controls, or difficulties
encountered in their implementation, could harm our operating results,
cause us to fail to meet our reporting obligations or result in
material misstatements in our financial statements. Any such failure
could also adversely affect the results of the periodic management
evaluations of our internal controls and, in the case of a failure to
remediate any material weaknesses that we may identify, would adversely
affect the annual auditor attestation reports regarding the
effectiveness of our internal control over financial reporting that are
required under Section 404 of the Sarbanes-Oxley Act. Inadequate
internal controls could also cause investors to lose confidence in our
reported financial information, which could have a negative effect on
the trading price of our common stock.
Because We Are Quoted On The OTCBB Instead Of An Exchange Or National
Quotation System, Our Investors May Have A Tougher Time Selling Their
Stock Or Experience Negative Volatility On The Market Price Of Our
Stock.
Page 18
Our common stock is traded on the OTCBB. The OTCBB is often highly
illiquid. There is a greater chance of volatility for securities that
trade on the OTCBB as compared to a national exchange or quotation
system. This volatility may be caused by a variety of factors,
including the lack of readily available price quotations, the absence
of consistent administrative supervision of bid and ask quotations,
lower trading volume, and market conditions. Investors in our common
stock may experience high fluctuations in the market price and volume
of the trading market for our securities. These fluctuations, when they
occur, have a negative effect on the market price for our securities.
Accordingly, our stockholders may not be able to realize a fair price
from their shares when they determine to sell them or may have to hold
them for a substantial period of time until the market for our common
stock improves.
Once publicly trading, the application of the "penny stock" rules could
adversely affect the market price of our common shares and increase
your transaction costs to sell those shares. The Securities and
Exchange Commission has adopted rule 3a51-1 which establishes the
definition of a "penny stock," for the purposes relevant to us, as any
equity security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt,
rule 15g-9 require:
* that a broker or dealer approve a person's account for
transactions in penny stocks; and
* the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and quantity
of the penny stock to be purchased
In order to approve a person's account for transactions in penny
stocks, the broker or dealer must:
* obtain financial information and investment experience
objectives of the person; and
* make a reasonable determination that the transactions in penny
stocks are suitable for that person and the person has sufficient
knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a
penny stock, a disclosure schedule prescribed by the SEC relating to
the penny stock market, which, in highlight form:
* sets forth the basis on which the broker or dealer made the
suitability determination; and
* that the broker or dealer received a signed, written agreement
from the investor prior to the transaction.
* Generally, brokers may be less willing to execute transactions
in securities subject to the "penny stock" rules. This may make it more
difficult for investors to dispose of our common stock and cause a
decline in the market value of our stock.
Page 19
FINRA sales practice requirements may also limit a stockholder's
ability to buy and sell our stock.
In addition to the "penny stock" rules described above, the Financial
Industry Regulatory Authority (FINRA) has adopted rules that require
that in recommending an investment to a customer, a broker-dealer must
have reasonable grounds for believing that the investment is suitable
for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must
make reasonable efforts to obtain information about the customer's
financial status, tax status, investment objectives and other
information. Under interpretations of these rules, FINRA believes that
there is a high probability that speculative low priced securities will
not be suitable for at least some customers. FINRA requirements make it
more difficult for broker-dealers to recommend that their customers buy
our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for our shares.
The market price for our common shares is particularly volatile given
our status as a relatively unknown company with a small and thinly
traded public float, limited operating history and lack of profits
which could lead to wide fluctuations in our share price. The price at
which you purchase our common shares may not be indicative of the price
that will prevail in the trading market. You may be unable to sell your
common shares at or above your purchase price, which may result in
substantial losses to you.
The market for our common shares is characterized by significant price
volatility when compared to seasoned issuers, and we expect that our
share price will continue to be more volatile than a seasoned issuer
for the indefinite future. The volatility in our share price is
attributable to a number of factors. First, as noted above, our common
shares are sporadically and thinly traded. As a consequence of this
lack of liquidity, the trading of relatively small quantities of shares
by our shareholders may disproportionately influence the price of those
shares in either direction. The price for our shares could, for
example, decline precipitously in the event that a large number of our
common shares are sold on the market without commensurate demand, as
compared to a seasoned issuer which could better absorb those sales
without adverse impact on its share price. Secondly, we are a
speculative or "risky" investment due to our limited operating history
and lack of profits to date, and uncertainty of future market
acceptance for our potential products. As a consequence of this
enhanced risk, more risk-adverse investors may, under the fear of
losing all or most of their investment in the event of negative news or
lack of progress, be more inclined to sell their shares on the market
more quickly and at greater discounts than would be the case with the
stock of a seasoned issuer. Many of these factors are beyond our
Page 20
control and may decrease the market price of our common shares,
regardless of our operating performance. We cannot make any predictions
or projections as to what the prevailing market price for our common
shares will be at any time, including as to whether our common shares
will sustain their current market prices, or as to what effect that the
sale of shares or the availability of common shares for sale at any
time will have on the prevailing market price.
Shareholders should be aware that, according to SEC Release No.
34-29093, the market for penny stocks has suffered in recent years from
patterns of fraud and abuse. Such patterns include (1) control of the
market for the security by one or a few broker-dealers that are often
related to the promoter or issuer; (2) manipulation of prices through
prearranged matching of purchases and sales and false and misleading
press releases; (3) boiler room practices involving high-pressure sales
tactics and unrealistic price projections by inexperienced sales
persons; (4) excessive and undisclosed bid-ask differential and markups
by selling broker-dealers; and (5) the wholesale dumping of the same
securities by promoters and broker-dealers after prices have been
manipulated to a desired level, along with the resulting inevitable
collapse of those prices and with consequent investor losses. Our
management is aware of the abuses that have occurred historically in
the penny stock market. Although we do not expect to be in a position
to dictate the behavior of the market or of broker-dealers who
participate in the market, management will strive within the confines
of practical limitations to prevent the described patterns from being
established with respect to our securities. The occurrence of these
patterns or practices could increase the volatility of our share price.
Volatility in our common share price may subject us to securities
litigation, thereby diverting our resources that may have a material
effect on our profitability and results of operations.
As discussed in the preceding risk factors, the market for our common
shares is characterized by significant price volatility when compared
to seasoned issuers, and we expect that our share price will continue
to be more volatile than a seasoned issuer for the indefinite future.
In the past, plaintiffs have often initiated securities class action
litigation against a company following periods of volatility in the
market price of its securities. We may in the future be the target of
similar litigation. Securities litigation could result in substantial
costs and liabilities and could divert management's attention and
resources.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There were no defaults upon senior securities during the period ended
A0.
Page 21
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to the vote of securities holders
during the period ended February 28, 2011.
ITEM 5. OTHER INFORMATION
There is no information with respect to which information is not
otherwise called for by this form
ITEM 6. EXHIBITS
3.1 Articles of Incorporation(1)
3.2 Bylaws (1)
31.1 Certification of Chief Executive Officer Pursuant to Section
302 of the Sarbanes-Oxley Act(2)
31.2 Certification of Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act (2)
32.1 Certification of Chief Executive Officer Pursuant to Section 906
of the Sarbanes-Oxley Act(2)
32.2 Certification of Chief Financial Officer Pursuant to Section 906
of the Sarbanes-Oxley Act(2)
(1) Incorporated by reference to the Company's filing on Form SB-2,
as filed with the Securities and Exchange Commission on January
4, 2006.
(2) Filed herein.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Registrant
Date: April 14,2011
Monza Ventures Inc.
By: /s/ Mr. Chen Wang
Chen Wang
Chairman, Chief Executive Officer (Principle Executive
Officer, Principle Financial Officer)
Page 23
Exhibit 31.1
Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule
13a-14(a) and Rule 15d-14 under the Securities Exchange Act of 1934
--------------------------------------------------------------------
I, Chen Wang, Chief Executive Officer of the Company, certify that:
1. I have reviewed this Quarterly report on Form 10Q of
Monza Ventures Inc.;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this report;
3. Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this report;
4. The registrant's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
and internal control over financial reporting (as defined in Exchange
Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the period in
which this report is being prepared;
b. Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles;
c. Evaluated the effectiveness of the registrant's disclosure and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluations: and
d. Disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the
registrant's most recent fiscal quarter that has materially affected,
or is reasonably likely to materially affect, the registrant's internal
control over financial reporting; and
5. The registrant's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing
the equivalent functions):
a. All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting which
are reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.
Registrant
Date: April 14,2011
Monza Ventures Inc.
By: /s/ Chen Wang
Chen Wang
Chairman, Chief Executive Officer (Principle Executive
Officer, Principle Financial Officer)
Exhibit 31.2
Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule
13a-14(a) and Rule 15d-14 under the Securities Exchange Act of 1934
--------------------------------------------------------------------
I, Chen Wang, Chief Financial Officer of the Company, certify that:
1. I have reviewed this Quarterly report on Form 10Q of
Monza Ventures Inc.;
3. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this report;
3. Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this report;
4. The registrant's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
and internal control over financial reporting (as defined in Exchange
Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the period in
which this report is being prepared;
b. Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles;
c. Evaluated the effectiveness of the registrant's disclosure and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluations: and
d. Disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the
registrant's most recent fiscal quarter that has materially affected,
or is reasonably likely to materially affect, the registrant's internal
control over financial reporting; and
5. The registrant's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing
the equivalent functions):
a. All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting which
are reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.
Registrant
Date: April 14,2011 Monza Ventures Inc.
By: /s/ Chen Wang
Chen Wang
Chairman, Chief Executive Officer (Principle Executive
Officer, Principle Financial Officer)
Exhibit 32.1
CERTIFICATIONS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002 (18 U.S.C. SECTION 1350)
--------------------------------------------------------------------
In connection with the Quarterly Report of Monza Ventures Inc. (the
"Company") on Form 10-Q for the period ending February 28, 2011 as filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Chen Wang, Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in
all material respects, the financial condition and result of operations
of the Company.
Registrant
Date: April 14, 2011
Monza Ventures Inc.
By: /s/ Chen Wang
Chen Wang
Chairman, Chief Executive Officer (Principle Executive
Officer, Principle Financial Officer)
Exhibit 32.2
CERTIFICATIONS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002 (18 U.S.C. SECTION 1350)
--------------------------------------------------------------------
In connection with the Quarterly Report of Monza Ventures Inc.. (the
"Company") on Form 10-Q for the period ending February 28, 2011 as filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Chen Wang, Principle Financial Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in
all material respects, the financial condition and result of operations
of the Company.
Registrant
Date: April 14,2011
Monza Ventures Inc.
By: /s/ Chen Wang
Chen Wang
Chairman, Chief Executive Officer (Principle Executive
Officer, Principle Financial Officer)
