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EX-31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER - RegalWorks Media, Inc.exhibit_31-1.htm
EX-32.1 - CERTIFICATION PURSUANT TO 18 U.S.C. 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 - RegalWorks Media, Inc.exhibit_32-1.htm

 
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



Form 10-Q

 
 
 
[mark one]

x           QUARTERLYREPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934
 
For the quarterly period ended: June 30, 2011

 
o           TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934
 
For the transition period from ___________ to ____________
   
Commission File Number: 000-52846

AMERELITE SOLUTIONSä, INC.

(Name of small business issuer in its Charter) 
 
 
Nevada
76-0766174
(State or other jurisdiction of
(I.R.S. Employer
Incorporation or organization)
Identification No.)


3122 W. Clarendon Ave.
Phoenix, AZ 85017
  (Address of Principal Executive Offices)

602-233-0540
(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. x Yes      o 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
o
 
Accelerated Filer
o
         
Non-accelerated filer
o
(Do not check if smaller reporting company) 
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 o No x

As of August 12, 2011 the registrant had 15,084,353 shares of its common stock, $.00125 par value, issued and outstanding.
 
 
 
 
1

 
 
 
AmerElite Solutions, Inc.
(A Development Stage Company)
 
Table of Contents
 
   
Page
     
Part I - Financial Information
     
Item 1.
Financial Statements
3
     
 
Balance Sheets as of June 30, 2011 (Unaudited) and December 31, 2010
3
     
 
Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2011 and 2010
4
     
 
Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2011 and 2010
5
     
 
Notes to Financial Statements
6
     
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
8
     
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
9
     
Item 4T.
Controls and Procedures
9
     
Part II - Other Information
     
Item 1.
Legal Proceedings
10
     
Item 1A.
Risk Factors
10
     
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
10
     
Item 3.
Defaults Upon Senior Securities
10
     
Item 4.
Submission of Matters to a Vote of Security Holders
10
     
Item 5.
Other Information
10
     
Item 6.
Exhibits
10
     
Signatures
 
11
 

 
 
 
 
 
 
 
2

 
 
AmerElite Solutions, Inc.
(A Development Stage Company)
 
Balance Sheets
 
 
   
June 30
   
December 31,
 
   
2011
   
2010
 
   
(Unaudited)
   
Audited
 
ASSETS
 
             
Current Assets:
           
Cash and Cash Equivalents
  $ 877     $ 757  
Accounts Receivable
    -       -  
Inventory
    -       -  
                 
Total Current Assets
    877       757  
                 
Fixed Assets:
               
Furniture and Equipment, net
    941       1,941  
Other Assets:
               
Pre-Paid Expenses
    -          
Deposits
    1,135       1,135  
                 
Total Assets
  $ 2,953     $ 3,833  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
                 
Current Liabilities
               
Accounts Payable
  $ 239,743     $ 251,162  
Accrued Payroll-Directors
    -       -  
Notes Payable
    52,850       44,900  
Related Party Payables
    -       70,000  
                 
Total Current Liabilities
    292,593       366,062  
                 
Total Liabilities
    292,593       366,062  
                 
Stockholders' Equity/(Deficit)
               
                 
Preferred Stock, authorized 2,000,000
               
shares, par value $0.001, issued and
               
outstanding 1,250,000 shares
    1,250       1,250  
 
               
                 
Common Stock, authorized 20,000,000
               
shares, par value $0.00125, issued and
               
oustanding 15,084,353 shares
    18,854       18,854  
 
               
                 
Additional Paid-in Capital
    2,998,338       2,992,533  
Subscriptions (Receivable)
    -       (76,226 )
Accumulated Deficit during Development Stage
    (3,308,082 )     (3,298,640 )
                 
Total Stockholders' Equity/(Deficit)
    (289,640 )     (362,229 )
                 
Total Liabilities and Stockholders' Equity
  $ 2,953     $ 3,833  
                 
                 
The accompanying notes are an integral part of these statements
               

 
3

 
 
AmerElite Solutions, Inc.
(A Development Stage Company)
 
Statements of Operations
 
 
   
Three Months Ended
   
Six Months Ended
   
July 26, 1994
 
   
June 30
   
June 30
   
June 30
   
June 30
   
(Inception)
 
   
 
                     
to June 30
 
   
2011
   
2010
   
2011
   
2010
   
2011
 
         
 
                   
                               
Revenue
  $ -     $ -     $ -     $ -     $ 21,759  
                                         
Total Revenue
    -       -       -       -       21,759  
                                         
Cost of Goods Sold
    -       -       -       -       5,320  
                                         
Gross Profit
    -       -       -       -       16,439  
                                         
Operating Expenses
                                       
Salaries and Wages
    -       -       -       57,500       1,059,698  
General and Administrative
    1,145       1,015       2,072       8,243       911,325  
Professional and Consulting
    2,530       11,195       7,370       12,086       549,899  
Product Development
                                    84,851  
Marketing
                                    289,551  
Investor Relations
    -       -       -       -       465,672  
                                         
Total Expenses
    3,675       12,210       9,442       77,829       3,360,996  
                                         
(Loss) from Operations
    (3,675 )     (12,210 )     (9,442 )     (77,829 )     (3,344,557 )
                                         
Other Income/(Expense)
                                       
Other Income
    -       -               -       4,519  
Interest Income
    -       -                       45,173  
Interest Expense
                                    (13,217 )
                                         
Total Other Income/(Expense)
    -       -       -       -       36,475  
                                         
Net Income/(Loss) Before Income Taxes
    (3,675 )     (12,210 )     (9,442 )     (77,829 )     (3,308,082 )
                                         
Income Tax Expense
    -       -       -       -       -  
                                         
Net Income/(Loss)
  $ (3,675 )   $ (12,210 )   $ (9,442 )   $ (77,829 )   $ (3,308,082 )
                                         
Basic (Loss) per Share
  $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.01 )        
                                         
Weighted Average Number of Common Shares
    15,084,353       15,084,353       15,084,353       15,084,353          
                                         
                                         
The accompanying notes are an integral part of these statements
                                       
 
 
 
4

 
 
AmerElite Solutions, Inc.
(A Development Stage Company)
 
Statements of Cash Flows
 
 
   
Six Months Ended
   
July 26, 1994
 
   
June 30
   
June 30
   
(Inception)
 
   
 
         
to June 30
 
   
2011
   
2010
   
2011
 
Operating Activities
 
 
             
Net Loss
  $ (9,442 )   $ (77,829 )   $ (3,308,082 )
Adjustments to reconcile Net Loss:
                       
   Stock Issued for Service
    -       -       1,594,905  
   Depreciation and Amortization
    1,000       1,000       19,500  
Changes in Operating Assets and Liabilities
                       
   (Increase)/Decrease in Deposits
    -       -       (1,135 )
   Increase/(Decrease) in Accounts Payable
    (1,888 )     61,180       794,710  
   Increase/(Decrease) in Accrued Liabilities
    -       -       70,000  
   Write Offs
    -       -       435,279  
                         
Net Cash (Used) by Operating Activities
    (10,330 )     (15,649 )     (394,823 )
                         
Investment Activities
                       
Investment in Trademarks and Trade Names
    -       -       (13,729 )
Purchase of Equipment
    -       -       (20,441 )
                         
Net Cash (Used) by Investment Activities
    -       -       (34,170 )
                         
Financing Activities
                       
Pre-Paid Expenses
    -       0       -  
Proceeds from Loans
    10,450       14,500       472,659  
(Repayment) of Loans
    -       -       (366,563 )
Proceeds from the Sale of Stock
    -       -       323,774  
                         
Net Cash Provided by Financing Activities
    10,450       14,500       429,870  
                         
Net Increase / (Decrease) in Cash
    120       (1,149 )     877  
                         
Cash, Beginning of Period
    757       1,915       -  
                         
Cash, End of Period
  $ 877     $ 766     $ 877  
                         
Supplemental Information:
                       
Interest Paid
  $ -     $ -     $ 13,217  
Income Taxes Paid
  $ -     $ -     $ -  
                         
Significant Non-Cash Transactions:
                       
Stock Issued for Services
  $ -     $ -     $ 1,594,905  
Stock issued to Convert Debt
  $ -     $ -     $ 553,232  
Paid in Capital - Debt Relief
  $ 82,031             $ 82,031  
Stock Issued to Acquire Assets
  $ -     $ -     $ 400,000  
                         
The accompanying notes are an integral part of these statements
                       
 
 
 
 
5

AMERELITE SOLUTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
 
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

AmerElite Solutions, Inc. (the Company) was originally incorporated in the state of Nevada July 26, 1994 as ABC Home Care Specialists, Inc., and on May 18, 2005 changed its name to AmerElite Solutions, Inc. The Company is in the business of marketing and distributing skin care products.

Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.

Accounts receivable

The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary.

Inventories

Inventories, consisting of building materials, are stated at the lower of cost or market (first-in, first-out method).

Property and equipment

Property and equipment are recorded at cost and depreciated under straight line methods over each item's estimated useful life.

Revenue recognition

Revenue is recognized on an accrual basis as earned under contract terms.



 
 
6

AMERELITE SOLUTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and 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.

Income tax

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Net income (loss) per share

The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.

Financial Instruments

The carrying value of the Company’s financial instruments as reported in the accompanying balance sheet, approximates fair value.



 
7

 
 
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion is a discussion and analysis of our financial condition and results of operations for the six  months ended June 30, 2011 and significant factors that could affect our prospective financial condition and results of operations.  Historical results may not be indicative of future performance.

This report on Form 10-Q contains forward-looking statements within the meaning of and which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements.  Forward-looking statements generally are accompanied by words such as “anticipates”, “believes”, “estimates”, “expects”, “intends”, “plans” and similar statements and should be considered uncertain and forward-looking.  Any forward-looking statements speak only as of the date on which such statement is made, are not guarantees of future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict.  Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements, whether as a result of new information, future events or otherwise.

Factors that could cause such results to differ materially from the results discussed in such forward looking statements include, without limitation; uncertain continued ability to meet our operational needs in view of continued severe ongoing working capital constraints; need for substantial additional capital to fully implement our plan of operations; no assurances of and uncertainty of profitability; no assurances of the Company’s ability to effect sufficient product sales so as to maintain exclusivity in certain territorial markets, the result of which could materially adversely effect the Company’s results of operations; need for additional management, sales and marketing personnel, which is contingent upon our receipt of additional capital; competition from companies having substantially greater financial, marketing and other resources than the Company, including name and brand recognition; the impact of competitive services and pricing; changing consumer tastes and trends; and the legal, auditing and administrative cost of compliance associated the Sarbanes Oxley Act.

Many of such factors are beyond our control.  New factors emerge from time to time and it is not possible for management to predict all of such factors, nor can it assess the impact of each factor on our business or the extent to which any factor, or combination of factors may cause actual results to differ materially from those contained in any forward looking statements.  In light of these risks and uncertainties, there can be no assurance that the results anticipated in these forward-looking statements in this report will in fact occur.  All forward-looking statements wherever they may appear are expressly qualified in their entirety by the cautionary statements in this section.  We undertake no obligation to update any such forward-looking statements.

General

We are a start up business engaged in the development, manufacturing and marketing of a premium skin care collection designed to provide a full spectrum of skin care products that naturally improve skin wellness and provide anti-aging properties to a rapidly expanding health and wellness market.

We have earned no revenues in 2011 from our business operations.  Accordingly, we may be required to raise cash from sources other than our operations in order to continue our business plan.  We may raise this additional capital either through debt or equity.  No assurance can be given that such efforts will be successful.  We have no specific plans at present for raising additional capital.

Since our inception, we have been engaged in business planning activities, including the launch of our product line, product research with professional focus groups, production of an infomercial, launch of a e-commerce website, developing our economic models and financial forecasts.
 
Results of Operations:
 
Three Months Ended June 30, 2011 and June 30, 2010.

During the three months ended June 30, 2011 we generated $0 in revenue compared to revenues of $0 for the same period ending June 30, 2010.. Net losses for the three months ending June 30, 2011, were $ (3,675) compared to net losses of $ (12,210) for the same period ending June 30, 2010, and were primarily attributable to administrative expenses, professional and consulting fees.

For the quarter ended June 30, 2011 there were no sales of the Collesense™ Premium Skin Care Collection.  The company needs additional capital to manufacture product.  Cost of Goods for the period ending June 30, 2011 was $0.  The total Operating Expenses for the period ending June 30, 2011 were $3,675.  The decrease in our Operating Expenses was attributable to the reduction of General and Administrative and the elimination of Salaries and Wages.  With a Gross Profit of $0 and operating expenses totaling $3,675 the Company had a loss from operation in the six (6) months ending June 30, 2011 of $3,765.
 
 

 
8

 
 
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations. - continued
 
Six Months Ended June 30, 2011 and June 30, 2010.
 
During the six months ended June 30, 2011 we generated $0 in revenue compared to revenues of $0 for the same period ending June 30, 2010. Net losses for the six months ending June 30, 2011, were $ (9,442) compared to net losses of $ (77,829) for the same period ending June 30, 2010, and were primarily attributable to administrative expenses, professional and consulting fees.

Liquidity and Capital Resources:
 
At June 30, 2011, the company’s total assets of $2,953were exceeded by total current liabilities of $292,593. The Company had cash on hand of $877.

We have limited capital resources, as, among other things, we are a start up company with a limited operating history.  We did not generate any revenues in 2010 or for the first six months of 2011, and may not be able to generate sufficient revenues to become profitable in the future.

Our cash reserves are not sufficient to meet our obligations for the next 6-month period.  As a result, we may need to seek additional funding in the near future.  We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of loans or in the form of equity financing from the sale of our common stock, $.00125 par value, on best efforts to accredited investors only, pursuant to the exemptions from registration in Section 4 (2) and Regulation D adopted under the Securities Act of 1933 as amended.  We do not have any arrangements in place for any future equity financing or loans.

We do not currently own any significant plant or equipment that we will seek to sell in the near future.

We do not anticipate the need to hire employees over the next 12 months.  We believe that our operations are currently on a small scale and are manageable by one individual.


Item 3.  Quantitative and Qualitative Disclosers About Market Risk.

Not Applicable
 

Item 4T.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures.

As required by Rule 13a-15 under the Exchange Act, we have carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this quarterly report.  This evaluation was carried out under the supervision and with the participation of our management, including our principal executive officer and principal financial officer.  Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective as at the end of the period covered by this quarterly report 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 by the rules and forms of the SEC.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported, within time periods specified in the Securities and Exchange Commission’s rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Controls

There were no significant changes in our internal controls or in other factors that could significantly affect those controls since the most recent evaluation of such controls.



 
 
 
9

 
 

Part II – Other Information
 
ITEM 1.  LEGAL PROCEEDINGS

None.


ITEM 1(A).  RISK FACTORS

Not Required.

 
ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.
 
 
ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None.

 
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

 
ITEM 5.  OTHER INFORMATION

None.

 
ITEM 6.  EXHIBITS AND REPORTS

A.

B.
None
 

 
 
 
10

 
 




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.
 
 
 
AMERELITE SOLUTIONS, INC.
 
       
Date:  August 12, 2011 
By:
/s/ Robert L. Knapp
 
   
Principal Executive Officer
 
   
Principal Financial Officer
 
       

 
 
 
 
 
 
 
11