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EX-32.2 - WITH, INC.q1100232_ex32-2.htm
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D. C. 20549
 
FORM 10-Q
 
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended September 30, 2011
 
o 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 333-166343
 
MEDL MOBILE HOLDINGS, INC
 (Exact name of registrant as specified in its charter)
 
NEVADA
(State or other jurisdiction of incorporation or organization)
 
80-0194367
 (I.R.S. Employer Identification No.)
 
 18475 Bandilier Circle
Fountain Valley, California 92708
(Address of principal executive offices)
 
(310) 684-3490
(Issuer's telephone number)
 
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 o
 
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 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. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer o
Accelerated filer o
   
Non-accelerated filer o
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 o NO x
 
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 40,000,000 shares as of November 7, 2011
 
 
 

 
 
NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
Our disclosure and analysis in this Report contains forward-looking statements which provide our current expectations or forecasts of future events.  Forward-looking statements in this Report include, without limitation:
 
 
·
information concerning possible or assumed future results of operations, trends in financial results and business plans, including those related to earnings, earnings growth, revenue and revenue growth;
 
·
statements about the level of our costs and operating expenses relative to our revenues, and about the expected composition of our revenues;
 
·
statements about expected future sales trends for our products and services;
 
·
statements about our future capital requirements and the sufficiency of our cash and cash equivalents;
 
·
other statements about our plans, objectives, expectations and intentions;
 
·
and other statements that are not historical fact.
 
Forward-looking statements generally can be identified by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “intends, “plans,” “should,” “seeks,” “pro forma,” “anticipates,” “estimates,” “continues,” or other variations thereof (including their use in the negative), or by discussions of strategies, plans or intentions.  Such statements include but are not limited to statements under Part I, Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Report, and elsewhere in this Report.  A number of factors could cause results to differ materially from those anticipated by such forward-looking statements. The absence of these words does not necessarily mean that a statement is not forward-looking.  Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons.
 
You should not unduly rely on these forward-looking statements, which speak only as of the date of this Report.  We undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Report, or to reflect the occurrence of unanticipated events.  You should, however, review the factors and risks we describe in the reports we file from time to time with the Securities and Exchange Commission
 
 
 

 
 
Table of Contents
 
   
Page
 
PART I
 
Item 1.
Financial Statements.
 
 
1
 
2
 
3
 
4
Item 2.
17
Item 3.
20
Item 4.
20
 
PART II
 
Item 1.
21
Item 1A.
21
Item 2.
21
Item 3.
21
Item 4.
21
Item 5.
21
Item 6.
23
24
 
 
ITEM 1. FINANCIAL STATEMENTS.
 
MEDL MOBILE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
 
   
SEPTMBER 30
   
DECEMBER 31
 
   
2011
   
2010
 
   
UNAUDITED
   
 
 
ASSETS
           
             
Current assets:
           
  Cash
  $ 1,757,243     $ 40,682  
  Accounts receivable
    387,281       40,622  
  Prepaid expenses
    6,750       -  
     Total current assets
    2,151,274       81,304  
                 
Fixed assets, net of depreciation
    59,047       6,417  
                 
Other asset:
               
  Security deposit
    19,857       7,257  
     Total other asset
    19,857       7,257  
                 
Total assets
  $ 2,230,178     $ 94,978  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
                 
Current liabilities:
               
  Accounts payable and accrued expenses
  $ 99,742     $ 6,972  
  Shareholder loans
    -       40,534  
     Total liabilities
    99,742       47,506  
                 
Stockholders' Equity:
               
Preferred stock, $0.001 par value; 10,000,000 shares
               
  authorized; none issued and outstanding.
    -       -  
Common stock, $0.001 par value, 500,000,000 shares
               
  authorized: 40,000,000 issued and outstanding
               
  at September 30, 2011 and 7,401,500; issued and outstanding
               
  at December 31, 2010
    40,000       7,402  
Additional paid-in capital
    2,629,370       95,098  
Accumulated  deficit
    (538,934 )     (55,028 )
     Total stockholders' equity
    2,130,436       47,472  
                 
Total liabilities and stockholders' equity
  $ 2,230,178     $ 94,978  
 
The accompanying notes are an integral part of these financial statements
 
 
MEDL MOBILE HOLDINGS , INC
CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
 
   
For the
   
For the
   
For the
   
For the
 
   
Three months
   
Three months
   
Nine months
   
Nine months
 
   
Ended
   
Ended
   
Ended
   
Ended
 
   
9/30/2011
   
9/30/2010
   
9/30/2011
   
9/30/2010
 
                         
Revenues
  $ 705,028     $ 201,532     $ 1,656,751     $ 496,379  
                                 
Cost of goods sold
    369,673       130,663       780,434       362,672  
                                 
Gross profit
    335,355       70,869       876,317       133,707  
                                 
Expenses:
                               
 Selling, general and administrative
    611,322       35,925       1,357,511       111,180  
Total expenses
    611,322       35,925       1,357,511       111,180  
                                 
Net (loss) profit before other income (expense)
    (275,967 )     34,944       (481,194 )     22,527  
                                 
Other income (expense):
                               
  Interest expense
    -       -       (2,712 )     -  
Total other income (expense)
    -       -       (2,712 )     -  
                                 
Net (loss) profit
  $ (275,967 )   $ 34,944     $ (483,906 )   $ 22,527  
                                 
NET (LOSS) PROFIT PER COMMON SHARE
                               
  Basic and Diluted
  $ (0.01 )   $ 0.00     $ (0.03 )   $ 0.00  
                                 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
                               
  Basic and Diluted
    40,000,000       7,401,500       19,222,934       7,401,500  
 
The accompanying notes are an integral part of these financial statements
 
 
MEDL MOBILE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
 
   
For the nine
   
For the nine
 
   
months ended
   
months ended
 
   
September 30, 2011
   
September 30, 2010
 
 
 
 
   
 
 
Cash flows from operating activities:
       
 
 
  Net (loss) profit
  $ (483,906 )   $ 22,527  
   Adjustments to reconcile net (loss) profit to net cash
               
    used in operating activities:
               
  Depreciation
    8,671       -  
  Stock based compensation on options granted
    66,870       -  
Changes in operating assets and liabilities:
               
  (Increase) in accounts receivable
    (346,659 )     -  
  (Increase) in prepaid expenses
    (6,750 )     -  
  (increase) in security deposits
    (12,600 )     (7,256 )
  Increase (decrease) in accounts payable
    92,770       (5,676 )
      Net cash (used in) provided by operating activities
    (681,604 )     9,595  
                 
Cash flows from investing activities:
               
  Purchase of office equipment
    (61,301 )     (2,248 )
      Net cash (used in) investing activities
    (61,301 )     (2,248 )
                 
Cash flows from financing activities:
               
  Decrease  in shareholder loans
    (40,534 )     (40,750 )
  Proceeds from convertible bridge notes
    300,000       -  
  Proceeds from issuance of common stock
    2,200,000       -  
     Net cash provided by (used in) financing activities
    2,459,466       (40,750 )
                 
Net increase (decrease) in cash
    1,716,561       (33,403 )
                 
Cash at beginning of period
    40,682       42,258  
                 
Cash at end of period
  $ 1,757,243     $ 8,855  
                 
SUPPLEMENTAL CASH FLOW INFORMATION:
               
  Cash paid during year for interest
               
    Interest
  $ -     $ -  
    Income taxes
  $ 800     $ -  
                 
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
         
                 
Issuance of common stock for payment of bridge notes
  $ 300,000          
 
The accompanying notes are an integral part of these financial statements
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 1 -ORGANIZATION AND BASIS OF PRESENTATION
 
The unaudited financial statements included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).  The financial statements and notes are presented as permitted on Form 10-Q and do not contain information included in the Company’s annual statements and notes.  Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.  It is suggested that these financial statements be read in conjunction with the audited financial statements and accompanying notes thereto for the year ended December 31, 2010 filed as Exhibit 99.1 to the Current Report on Form 8-K filed with the SEC on June 29, 2011.  While management believes the procedures followed in preparing these financial statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and procedures that will be accomplished by the Company later in the year.
 
These unaudited financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary to present fairly the operations and cash flows for the periods presented
 
MEDL Mobile Holdings, Inc. (the “Registrant”) through its wholly owned subsidiary, MEDL Mobile, Inc. (“MEDL” and together with the Registrant, “we”, “our”, “us”, or the “Company”) is a developer, incubator, marketer and aggregator of mobile application software, or “Apps”.
 
The Registrant, formerly known as Resume in Minutes, Inc. was incorporated in Nevada on May 22, 2008.  On June 24, 2011, the Registrant completed a share exchange with MEDL, a California corporation, and the shareholders of MEDL (the “MEDL Shareholders”) according to which the MEDL Shareholders transferred all of the issued and outstanding capital stock of MEDL to the Registrant in exchange for the issuance to the MEDL Shareholders of an aggregate of 20,000,000 shares of common stock of the Registrant.  As a result of the share exchange, MEDL became a wholly owned subsidiary of the Registrant and the business of MEDL became the sole line of business of the Registrant.
 
The share exchange was accounted for as a reverse-merger and recapitalization. MEDL is the acquirer for financial reporting purposes and MEDL Mobile Holdings, Inc. is the acquired company. Consequently, the assets and liabilities and the operations reflected in the historical financial statements prior to the share exchange are those of MEDL and recorded at the historical cost basis of MEDL, and the consolidated financial statements after completion of the share exchange include the assets and liabilities of the Registrant and MEDL, historical operations of MEDL and operations of Registrant from the closing date of the share exchange.
 
At June 30, 2011, the Company had in its Quarterly Report on Form 10-Q an explanatory paragraph in respect to the substantial doubt of the Company’s ability to continue as a going concern even though it had just raised $2,500,000 through the sale of its common stock. At September 30, 2011, the Company’s cash on hand was $1,757,243.  The Company’s sales have increase in the current quarter over the previous quarter by $131,960 or 23%.  The Company anticipates its revenues for the remainder of 2011 and for the year ended December 31, 2012 to continue to increase.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Principles of Consolidation
 
The accompanying consolidated financial statements include the accounts of all of the entities that make up the Company.  All significant inter-company balances and transactions have been eliminated.
 
Reclassification
 
The Company has made certain reclassifications to conform to prior periods’ data to the current presentation.  These reclassifications had no effect on reported losses, operating ratios or ROI measurements.
 
Basis of Accounting
 
The accompanying unaudited interim financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the United States Securities and Exchange Commission (the “Commission”) for interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, stockholders’ equity or cash flows. 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 statement presentation.
 
The results of operations for the nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2011. The accompanying statements should be read in conjunction with the more detailed financial statements, and the related footnotes thereto, filed with the Company’s Current Report on Form 8-K filed on June 30, 2011.
 
Use of Estimates
 
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the 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.  On an on-going basis, the Company evaluates its estimates, including, but not limited to, those related to investment tax credits, bad debts, income taxes and contingencies. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.
 
Cash and Cash Equivalents
 
The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.  The Company maintains cash and cash equivalent balances at one financial institution that is insured by the Federal Deposit Insurance Corporation.  Any amounts of cash in financial institutions over FDIC insured limits, exposes the Company to cash concentration risk.
 
Fair Value of Financial Instruments (other than Derivative Financial Instruments)
 
The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, and accounts payable approximate fair value because of the immediate or short-term maturity of these financial instruments. For the notes payable, the carrying amount reported is based upon the incremental borrowing rates otherwise available to the Company for similar borrowings.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
Revenue Recognition
 
Recurring revenues are earned on a monthly basis and include software application license and support fees as well as Application (also referred to as “Apps”) hosting fees. Monthly recurring fees billed in advance and the revenue is recognized in the month in which the fees are applicable. Nonrecurring revenues from implementation fees for new client installation and consulting and training fees for existing clients are recognized as the services are performed. Nonrecurring revenues related to perpetual license sale with multiple elements are recognized in accordance with the guidance on software revenue recognition. When the arrangement with a customer includes significant production, modification, or customization of the software, we recognize the related revenue using the percentage-of-completion method in accordance with the accounting guidance for construction-type and certain production-type contracts.
 
The Company receives a deposit of up to fifty (50%) percent of the proposed project contract at the time that the contract is signed.  Significant work has been done by the Company at this time and the deposit is non-refundable and therefore is recognized as revenue to the Company.  Another twenty five (25%) percent of the contract is billable per stated terms of the contract and revenue is recognized at that time.  Upon completion of the project to the client the remaining twenty five (25%) percent is billed to the client and recognized as revenue to the Company.  Apps projects are generally delivered within several months.
 
Accounts Receivable
 
Accounts receivable are stated at the amounts management expects to collect from outstanding balances.  Management provides for probable uncollectible amounts through a charge to earnings and a credit to a valuation allowance based on its assessment of the current status of individual accounts.  Balances outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to trade accounts receivable.  Management has determined that no allowance for doubtful accounts at September 30, 2011 and December 31, 2010 is required.
 
Accounts receivable will generally be due within 30 to 60 days and collateral is not required.
 
Income Taxes
 
Income taxes are accounted for under the asset and liability method in accordance with ASC 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the extent that the recoverability of the asset is unlikely to be recognized.
 
The Company follows ASC 740 rules governing uncertain tax positions, which provides guidance for recognition and measurement. This prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognization, classification and disclosure of these uncertain tax positions.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
Uncertainty in Income Taxes
 
Under ASC 740-10-25 recognition and measurement of uncertain income tax positions is required using a “more-likely-than-not" approach.  Management evaluates their tax positions on an annual basis and has determined that as of September 30, 2011 no additional accrual for income taxes is necessary.
 
Research and Development
 
The Company incurs costs on activities that relate to research and development of new technology and products.  Research and development costs are expensed as incurred.
 
Property and equipment
 
Property and equipment are stated at cost.  Expenditures that materially increase the life of the assets are capitalized.  Ordinary maintenance and repairs are charged to expense as incurred.  When assets are sold or otherwise disposed of, the cost and the related accumulated depreciation and amortization are removed from the accounts and any realized gain or loss is recognized at that time.
 
Depreciation is computed primarily on the straight line method for financial statement purposes over the following estimated useful lives:
 
Computer equipment                                                      3-5 years
 
Furniture and fixtures                                                     3-5 years
 
Fair Value of Financial Instruments (Other Than Derivative Financial Instruments)
 
The Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements.
 
ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:
 
 
Level 1:
Observable inputs such as quoted market prices in active markets for identical assets or liabilities
 
Level 2:
Observable market-based inputs or unobservable inputs that are corroborated by market data
 
Level 3:
Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions.
 
The carrying amounts reported in the balance sheet for cash, accounts payable, and accrued liabilities approximate their estimated fair market value based on the short-term maturity of this instrument.
 
In addition, FASB ASC 825-10-25 Fair Value Option was effective for January 1, 2008. ASC 825-10-25 expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
Investments
 
Investments that are purchased in other companies are valued at cost less any impairment in the value that is other than temporary in nature.
 
(Loss) Per Share of Common Stock
 
Basic net (loss) per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share ("EPS") include additional dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. Common stock equivalents were not included in the computation of diluted earnings per share on the consolidated statement of operations due to the fact that the Company reported a net loss and to do so would be anti-dilutive for the periods presented.
 
The following is a reconciliation of the computation for basic and diluted EPS:
 
   
September 30, 2011
   
September 30, 2010
 
Net (loss) profit
  $ (483,906 )   $ 22,527  
Weighted-average common shares
               
Outstanding (Basic)
    19,222,934       7,401,500  
   
Weighted-average common stock
               
Equivalents
               
Stock options
    2,644,172       -  
   
Weighted-average commons shares
               
Outstanding (Diluted)
    21,867,106       7,401,500  
 
Diluted net loss per share reflects the potential dilution that could occur if the securities or other contracts to issue common stock were exercised or converted into common stock.
 
Goodwill and Other Intangible Assets
 
In accordance with ASC 350- 30-65 (formerly SFAS 142, Goodwill and Other Intangible Assets), the Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Intangible assets were comprised of website assets. Factors the Company considers to be important which could trigger an impairment review include the following:
 
 
1.
Significant underperformance relative to expected historical or projected future operating results;
 
 
2.
Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and
 
 
3.
Significant negative industry or economic trends.
 
When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
Stock Based Compensation
 
The Company applies ASC 718-10 and ASC 505-50 (formerly SFAS 123R) in accounting for stock options issued to employees. The amount of compensation cost for share-based payments is measured based upon the fair value on the grant date of the equity instruments issued.  For stock options issued to non-employees, the Company applies the same standard.
 
Recently Issued Accounting Standards
 
In September 2006, ASC issued 820, Fair Value Measurements. ASC 820 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007.  The adoption of ASC 820 has had no material impact on the financial statements.
 
In February 2007, ASC issued 825-10, The Fair Value Option for Financial Assets and Financial Liabilities – Including an amendment of ASC 320-10, (“ASC 825-10”) which permits entities to choose to measure many financial instruments and certain other items at fair value at specified election dates. A business entity is required to report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. ASC 825-10 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.
 
In December 2007, ASC 808-10 (formerly EITF Issue No. 07-1, Accounting for Collaborative Arrangements) was issued.  ASC 808-10 provides guidance concerning: determining whether an arrangement constitutes a collaborative arrangement within the scope of the issue; how costs incurred and revenue generated on sales to third parties should be reported in the income statement; how an entity should characterize payments on the income statement; and what participants should disclose in the notes to the financial statements about a collaborative arrangement. The provisions of ASC 808-10 have been adopted in 2009. ASC 808-10 has had no impact on the Company’s financial statements.
 
In December 2007, the ASC issued ASC 810-10-65, Noncontrolling Interests in Consolidated Financial Statements. ASC 810-10-65 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, changes in a parent’s ownership of a noncontrolling interest, calculation and disclosure of the consolidated net income attributable to the parent and the noncontrolling interest, changes in a parent’s ownership interest while the parent retains its controlling financial interest and fair value measurement of any retained noncontrolling equity investment.
 
ASC 810-10-65 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. Management is determining the impact that the adoption of ASC 810-10-65 has had no material impact on the Company’s financial position, results of operations or cash flows.
 
In November 2009, the Company adopted ASC 805, Business Combinations (“ASC 805”). ASC 805 retains the fundamental requirements that the acquisition method of accounting be used for all business combinations and for an acquirer to be identified for each business combination. ASC 805 defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control.  ASC 805 will require an entity to record separately from the business combination the direct costs, where previously these costs were included in the total allocated cost of the acquisition.  ASC 805 will require an entity to recognize the assets acquired, liabilities assumed, and any non-controlling interest in the acquired at the acquisition date, at their fair values as of that date.
 
ASC 805 requires an entity to recognize as an asset or liability at fair value for certain contingencies, either contractual or non-contractual, if certain criteria are met.  Finally, ASC 805 requires an entity to recognize contingent consideration at the date of acquisition, based on the fair value at that date.  This will be effective for business combinations completed on or after the first annual reporting period beginning on or after December 15, 2008.  Early adoption is not permitted and the ASC is to be applied prospectively only.  Upon adoption of this ASC, there would be no impact to the Company’s results of operations and financial condition for acquisitions previously completed.  The adoption of ASC 805 has had no material effect on the Company’s financial position, results of operations or cash flows.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
In March 2008, ASC issued ASC 815, Disclosures about Derivative Instruments and Hedging Activities”, (“ASC 815”). ASC 815 requires enhanced disclosures about an entity’s derivative and hedging activities. These enhanced disclosures will discuss: how and why an entity uses derivative instruments; how derivative instruments and related hedged items are accounted for and its related interpretations; and how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. ASC 815 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The adoption of  ASC 815 has had no material effect on the Company’s results of operations or financial position.
 
In April 2008, ASC issued ASC 350, Determination of the Useful Life of Intangible Assets. This amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under ASC 350. The guidance is used for determining the useful life of a recognized intangible asset and shall be applied prospectively to intangible assets acquired after adoption, and the disclosure requirements shall be applied prospectively to all intangible assets recognized as of, and subsequent to, adoption. The adoption of ASC 350 has had no material effect on the Company’s financial position, results of operations or cash flows.
 
In June 2008, the FASB ratified ASC 815-40-25 (formerly EITF Issue No. 07-05, Determining Whether an Instrument (or Embedded Feature) is Indexed to an Entity's Own Stock. ASC 815-40-25 mandates a two-step process for evaluating whether an equity-linked financial instrument or embedded feature is indexed to the entity's own stock. Warrants that a company issues that contain a strike price adjustment feature, upon the adoption of ASC 815-40-25, results in the instruments no longer being considered indexed to the company's own stock.  On November 23, 2009, the Company adopted ASC 815-40-25 and re-evaluated its issued and outstanding warrants that contain a strike price adjustment feature.   Based upon the Company’s re-evaluation, ASC 815-40-25 has had no material impact on the Company’s consolidated financial statements.
 
Effective November 23, 2009, the Company adopted FASB ASU No. 2009-05, Fair Value Measurement and Disclosures (Topic 820) (“ASU 2009-05”). ASU 2009-05 provided amendments to ASC 820-10, Fair Value Measurements and Disclosures – Overall, for the fair value measurement of liabilities. ASU 2009-05 provides clarification that in circumstances in which a quoted market price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using certain techniques. ASU 2009-05 also clarifies that when estimating the fair value of a liability, a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of a liability. ASU 2009-05 also clarifies that both a quoted price in an active market for the identical liability at the measurement date and the quoted price for the identical liability when traded as an asset in an active market when no adjustments to the quoted price of the asset are required for Level 1 fair value measurements. Adoption of ASU 2009-05 did not have a material impact on the Company’s results of operations or financial condition.
 
In January 2010, the Company adopted FASB ASU No. 2010-06, Fair Value Measurement and Disclosures (Topic 820) - Improving Disclosures about Fair Value Measurements (“ASU 2010-06”). These standards require new disclosures on the amount and reason for transfers in and out of Level 1 and 2 fair value measurements. The standards also require new disclosures of activities, including purchases, sales, issuances, and settlements within the Level 3 fair value measurements. The standard also clarifies existing disclosure requirements on levels of disaggregation and disclosures about inputs and valuation techniques. These new disclosures are effective beginning with the first interim filing in 2010.  The disclosures about the roll-forward of information in Level 3 are required for the Company with its first interim filing in 2011. Adoption of ASU 2010-06 did not have a material impact on the Company’s results of operations or financial condition.
 
               In February 2010, the FASB issued ASU 2010-09, Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure Requirements. This update addresses both the interaction of the requirements of Topic 855, “Subsequent Events”, with the SEC’s reporting requirements and the intended breadth of the reissuance disclosures provision related to subsequent events (paragraph 855-10-50-4). The amendments in this update have the potential to change reporting by both private and public entities, however, the nature of the change may vary depending on facts and circumstances. Adoption of ASU 2010-09 did not have a material impact on the Company’s consolidated results of operations or financial condition
 
Other ASU’s that have been issued or proposed by the FASB ASC that do not require adoption until a future date and are not expected to have a material impact on the financial statements upon adoption.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 3 – PROPERTY AND EQUIPMENT
 
Fixed assets as of September 30, 2011 (unaudited) and December 31, 2010 were as follows:
 
   
Estimated
   
(unaudited)
       
   
Useful Lives
   
September 30,
   
December 31,
 
   
(Years)
   
2011
   
2010
 
Computer Equipment
    3-5     $ 61,617     $ 7,700  
Furniture and fixtures
    3-5       7,385       0  
              69,002       7,700  
   
Less: accumulated depreciation
            ( 9,955 )     (1,283 )
Fixed assets, net
          $ 59,047     $ 6,417  
 
There was $8,671 and $0 charged to operations for depreciation expense for the nine months ended September 30, 2011 and 2010, respectively.
 
NOTE 4 - PROVISION FOR INCOME TAXES
 
The provision (benefit) for income taxes for the nine months ended September 30, 2011 differs from the amount which would be expected as a result of applying the statutory tax rates to the income (losses) before income taxes due primarily to changes in the valuation allowance to fully reserve net deferred tax assets and also due to the fact that MEDL was taxed as a S Corporation from January to June 23, 2011, resulting in no tax benefit or deferred tax asset during this period.
 
With respect to tax periods prior to June 23, 2011, MEDL was taxed as a S Corporation.  Accordingly, all of the losses of MEDL flow through to the shareholders of the S Corporation and the Company has no deferred tax assets or loss carryforwards from this period.
 
Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income.  As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.
 
   
As of
September 30, 2011
 
 Deferred tax assets:
     
 Net Operating Loss
  $ (352,039 )
 Tax Rate
    34 %
 Total deferred tax assets
  $ 119,693  
 Less Valuation allowance
  $ (119,693 )
         
 Net deferred tax assets
  $ 0  
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 4 - PROVISION FOR INCOME TAXES (CONTINUED)
 
Reconciliation of the differences between the statutory tax rate and the effective tax rate is:
 
  
 
September 30,
 2011
Federal statutory tax rate
    34.0 %
Effective Tax Rate
    34.0 %
Valuation Allowance
    (34.0 %)
Net Effective Tax Rate
    0
 
As of September 30, 2011, the Company has a net operating loss carry forward of $352,039 expiring through 2031. The Company has provided a valuation allowance against the full amount of the deferred tax asset due to management’s uncertainty about its realization. Furthermore, the net operating loss carry forward may be subject to further limitation pursuant to Section 382 of the Internal Revenue Code.
 
NOTE 5 - RELATED PARTY TRANSACTIONS
 
The Company has entered into a sub-lease with a company in which the Company’s CEO and his family are shareholders.  The sublease is for approximately 4,500 square feet.  The term of the sub-lease is from January 1, 2011 and ends at November 30, 2015. (See also Note 6)
 
NOTE 6 - COMMITMENTS AND CONTINGENCIES
 
Lease
 
The Company is party to two non-cancelable lease agreements for office space through 2015. The first agreement is for approximately 4,500 square feet of space located at 18475 Bandilier Circle, Fountain Valley, CA.  The term of the sub-lease is from January 1, 2011 and ends at November 30, 2015.  The second lease is for approximately 4,786 square feet and is located at 18350 Mt. Langley Street, Fountain Valley, CA.  The term of this lease is from September 1, 2011 and ends at February 28, 2013.  At September 30, 2011, aggregate future minimum payments under these leases, is as follows:
 
2011
  $ 122,460  
2012
    100,180  
2013
    84,915  
2014
    87,210  
2015
    14,610  
         
Total
  $ 409,375  
 
Litigation
 
The Company is not presently involved in any litigation.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 7 – STOCKHOLDERS’ EQUITY (DEFICIT)
 
Preferred Stock
 
The authorized preferred stock of the Company consists of 10,000,000 shares of preferred stock at a par value of $0.001.  As of September 30, 2011, the Company had no outstanding shares of preferred stock.
 
Common Stock
 
The authorized common stock of the Company consists of 500,000,000 shares of common stock with a par value of $0.001.
 
In March, 2009, MEDL issued to each of Mr. Matlin and Mr. Swartz as founders’ shares 3,650,000 shares of its common stock, par value $0.01 per shares, as adjusted for MEDL’s October 1, 2009 7,300-for-one forward stock split.
 
On November 1, 2009, MEDL sold 101,500 shares of its common stock at a price per share of $1.00 to four investors for total aggregate proceeds of $101,500.
 
On April 20, 2011, MEDL sold an aggregate of $300,000 secured 5% bridge notes to certain accredited investors in a private placement transaction.  The bridge notes were to mature upon the earlier to occur of a private placement of at least $2,200,000 and simultaneous reverse merger or on October 20, 2011.  The principal amount of the bridge notes automatically exchanged into shares of common stock of the Company in the Private Placement (as defined below) at a price per share of $0.25.
 
On June 3, 2011, the board of directors of the Registrant authorized a 37.39716 for one forward split of its outstanding common stock in the form of a dividend, whereby an additional 36.39716 shares of common stock, par value $0.001 per share, were issued for each one share of common stock held by each shareholder of record on June 23, 2011.
 
On June 24, 2011, the Registrant completed a share exchange (the “Share Exchange”) with MEDL, a California corporation, and the shareholders of MEDL (the “MEDL Shareholders”) according to which the MEDL Shareholders transferred all of the issued and outstanding capital stock of MEDL to the Registrant in exchange for the issuance to the MEDL Shareholders of an aggregate of 20,000,000 shares of common stock of the Registrant.  The Share Exchange caused MEDL to become a wholly-owned subsidiary of the Registrant.
 
In connection with the closing of the share exchange, the Company sold 10,000,000 shares of common stock at a purchase price of $0.25 per share in a private placement to accredited investors, resulting in aggregate gross proceeds of $2,500,000 (including the exchange of bridge notes in the aggregate principal amount of $300,000) (the “Private Placement”).  Accrued interest of $2,712 in respect of the bridge notes was not paid at the closing and is included in accounts and accrued expenses payable at September 30, 2011.
 
Two business days following the closing of the Share Exchange and the Private Placement, the Company transferred all of its pre-Share Exchange assets and liabilities to a newly formed wholly-owned subsidiary, Resume in Minutes Holdings, Inc. (“SplitCo”).  Thereafter, the Company transferred all of the outstanding capital stock of SplitCo to certain of the Company’s former shareholders in exchange for the cancellation of 94,824,263 shares of common stock that they owned (the “Split-Off”).
 
As of September 30, 2011, the Company has 40,000,000 shares of common stock issued and outstanding.
 
Warrants
 
The Company has no warrants as of September 30, 2011 or for the nine months ended September 30, 2011 and year ended December 31, 2010.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 7 – STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
 
Share-Based Compensation and Options Issued to Consultants
 
2011 Equity Incentive Plan
 
The board of directors adopted the 2011 Equity Incentive Plan, as amended, (the “Plan”) of Medl Mobile Holdings, Inc. (Nevada) that provided for the issuance of a maximum of 6,000,000 shares of common stock.   As of September 30, 2011, options exercisable into 5,785,500 shares of common stock have been issued under this plan of which options exercisable for 3,960,000 shares of common stock have been issued to employees and options exercisable for 1,825,500 shares of common stock have been issued to non-employees. As of September 30, 2011, the Company had approximately 215,000 shares reserved for future grant under its Plan and there were no shares exercised during the first nine months of 2011.
 
The Company generally grants stock options to employees and directors at exercise prices equal to the fair market value of the Company's stock at the dates of grant. Stock options are typically granted throughout the year and generally vest over five years of service thereafter and expire ten years from the date of the award, unless otherwise specified. The Company recognizes compensation expense for the fair value of the stock options over the requisite service period for each stock option award.
 
Total share-based compensation expense included in the condensed consolidated statements of operations for the three and nine months ended September 30, 2011 and 2010 was $ 28,710 and $0, respectively.
 

There was no capitalized share-based compensation cost as of September 30, 2011 and there were no recognized tax benefits during the three and nine months ended September 30, 2011 and 2010.
 
To estimate the value of an award, the Company uses the Black-Scholes option-pricing model.  This model requires inputs such as expected life, expected volatility and risk-free interest rate.  The forfeiture rate also impacts the amount of aggregate compensation.  These inputs are subjective and generally require significant analysis and judgment to develop.  While estimates of expected life, volatility and forfeiture rate are derived primarily from the Company’s historical data, the risk-free rate is based on the yield available on U.S. Treasury constant maturity rates with similar terms to the expected term of the stock option awards.  The fair value of share-based awards was estimated using the Black-Scholes model with the following weighted-average assumptions for the three and nine months ended September 30, 2011:
 
Dividend Yield
 
$ 0
Expected Volatility
 
80.0%
Risk Free Interest Rate
 
2.5%
Expected Life
 
10 years
 
There were no options outstanding during the year ended December 31, 2010.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 7 – STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
 
Share-Based Compensation and Options Issued to Consultants
 
Employee share option activity for the nine months ended September 30, 2011 was as follows:
 
               
Weighted
       
               
Average
       
         
Weighted
   
Remaining
   
Aggregate
 
         
Average
   
Contractual
   
Intrinsic
 
   
Options
   
Exercise Price
   
Life (Yrs.)
   
Value
 
   
Options outstanding at December 31, 2010
                       
Granted
  3,960,000     $ 0.28              
Exercised
                         
Forfeited or cancelled
                         
Expired
                         
Options outstanding at September 30, 2011
    3,960,000       0.28       9.8     $ 2,336,400  
Options exercisable at September 30, 2011
    1,270,078       0.26       9.8       749,346  
Options exercisable and options expected
                               
to vest at September 30, 2011
    2,970,000       0.28       9.8       1,752,300  
 
The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of our common stock for those awards that have an exercise price currently below the closing price.
 
Unvested share activity for the nine months ended September 30, 2011 was as follows:
 
   
Unvested
   
Weighted
 
   
Number of
   
Average Grant
 
   
Options
   
Fair Value
 
Unvested balance at December 31, 2010
           
Granted
    3,960,000     $ 0.28  
Vested
    (1,270,078 )     0.26  
Forfeited
               
Unvested balance at September 30, 2011
    2,689,922       .0.29  
 
At September 30, 2011, there was $865,000 of unrecognized share-based compensation expense related to unvested employee share options with a weighted average remaining recognition period of 9.75 years.
 
 
MEDL MOBILE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
(Unaudited)
 
NOTE 7 – STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
 
Share-Based Compensation and Options Issued to Consultants
 
During June of 2011 the Company issued 1,570,000 options to consultants with an exercise price of $0.25.  1,195,500 of these shares vested immediately and the remainder of 375,000 shares vest over 6 months of service.  These options have a term of 10 years.  The Company recognized $38,160 in consulting expenses relating to these options.
 
During the quarter ended September 30, 2011, the Company issued an additional 255,000 options to consultants at exercise prices that ranged from $.25-$1.35 per share, none of which vested during the quarter. There are 442,500 unvested options and an additional $93,977 in consulting expense that will be recognized in future periods.
 
NOTE 8 – SUBSEQUENT EVENTS
 
 On November 1, 2011 the Company issued 60,000 stock options to three employees.  The exercise price was $0.88-0.89 per share.
 
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
 
Forward Looking Statements
 
Some of the statements contained in this Form 10-Q that are not historical facts are "forward-looking statements" which can be identified by the use of terminology such as "estimates," "projects," "plans," "believes," "expects," "anticipates," "intends," or the negative or other variations, or by discussions of strategy that involve risks and uncertainties. We urge you to be cautious of the forward-looking statements, that such statements, which are contained in this Form 10-Q, reflect our current beliefs with respect to future events and involve known and unknown risks, uncertainties and other factors affecting our operations, market growth, services, products and licenses. No assurances can be given regarding the achievement of future results, as actual results may differ materially as a result of the risks we face, and actual events may differ from the assumptions underlying the statements that have been made regarding anticipated events.
 
All written forward-looking statements made in connection with this Form 10-Q that are attributable to us or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements. Given the uncertainties that surround such statements, you are cautioned not to place undue reliance on such forward-looking statements.
 
Overview
 
We are primarily engaged in the monetization of mobile application software or “Apps” through four revenue generating platforms: (i) development of customized Apps for third parties to monetize their particular intellectual property, persona or brand, (ii) incubation of Apps in partnership with third parties and from a library of more than 75,000 original Apps concept submissions, (iii) sale of advertising and sponsorship opportunities directly to brands via mobile advertising networks and (iv) acquisition of Apps from other developers and use of a proprietary application programming interface, or API, to make Apps recommendations for our user base.
 
Recent Events
 
On June 24, 2011, we completed a share exchange pursuant to which we acquired all of the capital stock of MEDL Mobile, Inc., a California corporation (“MEDL”), which became our wholly owned subsidiary.  In connection with this share exchange, we discontinued our former business and succeeded to the business of MEDL as our sole line of business.  The share exchange is accounted for as a recapitalization.  MEDL is the acquirer for accounting purposes and we are the acquired company.  Accordingly, MEDL’s historical financial statements for periods prior to the acquisition have become those of the Registrant retroactively restated for, and giving effect to, the number of shares received in the share exchange.  The accumulated earnings of MEDL were also carried forward after the acquisition. Operations reported for periods prior to the share exchange are those of MEDL.
 
Critical Accounting Policies
 
We do not believe that the adoption of any recently issued, but not yet effective, accounting standards will have a material effect on our financial position and results of operations.
 
 
Results of Operations
 
Nine Months Ended September 30, 2011 Compared to Nine Months Ended September 30, 2010
 
The following table presents our results of operations for the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.
 
   
Nine Months
Ended
September 30, 2011
(Unaudited)
   
Nine Months Ended
September 30, 2010
(Unaudited)
 
             
Revenue
  $ 1,656,751     $ 496,379  
                 
Cost of Goods Sold
    780,434       362,672  
                 
Gross Profit
    876,317       133,707  
                 
Total Expenses:
    1,357,511       111,180  
                 
Net Loss before Interest  Expense
    (481,194 )     22,527  
                 
Interest Expense
    (2,712 )     -  
                 
Net Profit (Loss)
  $ (483,906 )   $ 22,527  
 
Revenues
 
Revenues for the nine months ended September 30, 2011 increased to $1,656,751 as compared to $496,379 for the nine months ended September 30, 2010, an increase of $1,160,372 or 233.8%. The increase is primarily attributable to growth of our customer base through our expanded sales force and referrals from existing customers.
 
Cost of Goods Sold
 
Cost of goods sold for the nine months ended September 30, 2011 increased to $780,434 as compared to $362,672 for the nine months ended September 30, 2010, an increase of $417,762 or 115.1 %.  The increase is primarily due to the addition of additional employees and outside contractors to fulfill customer orders for new mobile applications.
 
Gross Profit
 
Gross profit for the nine months ended September 30, 2011 increased to $876,317 as compared to $133,707 for the nine months ended September 30, 2010, an increase of $742,610 or 555.4 %.  Our gross margin increased due to the additional business generated which utilized existing employees and new employees more efficiently in producing the finished product for our customers.
 
Operating Expenses
 
Operating expenses for the nine months ended September 30, 2011 increased to $1,357,511 as compared to $111,180 for the nine months ended September 30, 2010, an increase of $1,246,331 or 1121.0 %.  The increase is primarily attributable to salaries paid to our officers, who had previously not been paid in the prior year, the increase in support staff, costs of moving into new corporate offices and legal and accounting costs incurred with the sale of stock and corporate filings with the Securities and Exchange Commission.
 
Net Loss
 
Net loss for the nine months ended September 30, 2011 was ($483,906), as compared to a net profit of $22,527 for the nine months ended September 30, 2010, a decrease of $506,433 or 2,248.0%. The net loss since March 4, 2009 (inception) through September 30, 2011 is $538,934.
 
 
Three Months Ended September 30, 2011 Compared to Three Months Ended September 31, 2010
 
The following table presents our results of operations for the three months ended September 30, 2011 compared to the three months ended September 30, 2010.
 
   
Three Months
Ended
September 30, 2011
(Unaudited)
   
Three Months Ended
September 30, 2010
(Unaudited)
 
             
Revenue
  $ 705,028     $ 201,532  
                 
Cost of Goods Sold
    369,673       130,663  
                 
Gross Profit
    335,355       70,869  
                 
Total Expenses:
    611,322       35,925  
                 
Net (Loss) Profit Before Interest Expense
    (275,967 )     34,945  
                 
Interest Expense
    -       -  
                 
Net (Loss) Profit
  $ (275,967 )   $ 34,944  
 
Revenues
 
Revenues for the three months ended September 30, 2011 increased to $705,028 as compared to $201,532 for the three months ended September 30, 2010 an increase of $503,496 or 249.8 %.  The increase is primarily attributable to growth of our company base through our expanded sales force and from referrals from existing customers.
 
Cost of Goods Sold
 
Cost of goods sold for the three months ended September 30, 2011 increased to $369,673 as compared to $130,663 for the three months ended September 30, 2010 an increase of $239,010 or 182.9 %.  The increase is primarily attributable to the addition of additional employees and outside contractors to fulfill customer orders for new mobile applications.
 
Gross Profit
 
Gross profit for the three months ended September 30, 2011 increased to $335,355 as compared to $70,869 for the three months ended September 30, 2010 an increase of $264,486 or 373.2 %.  Our gross margin increased due to the additional business generated which utilized existing employees and new employees more efficiently in producing the finished product for our customers.
 
Operating Expenses
 
Operating expenses for the three months ended September 30, 2011 increased to $611,322 as compared to $35,925 for the three months ended September 30, 2010 an increase of $575,397 or 1,601.7 %.  The increase is primarily attributable to salaries paid to our officers, who had previously not been paid in the prior year, the increase in support staff, costs of moving into new corporate offices and legal and accounting costs incurred with the sale of stock and corporate filings with the Securities and Exchange Commission.
 
Net Loss
 
Net loss for the three months ended September 30, 2011 was $(275,967) as compared to a net profit of $34,944 for the three months ended September 30, 2010, a decrease of $310,911 or 889.7%.
 
 
Liquidity and Capital Resources
 
Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.
 
Our business is still in the early stages, having commenced operations on March 4, 2009.  At September 30, 2011 and December 31, 2010, we had cash of $1,757,243 and $40,682, respectively and working capital of $2,051,532 and $33,798, respectively.  In connection with the closing of the share exchange on June 24, 2011, we sold 10,000,000 shares of our common stock at a purchase price of $0.25 per share in a private placement to accredited investors, resulting in aggregate gross proceeds of $2,500,000 (including the exchange of bridge notes in the aggregate principal amount of $300,000).
 
To date we have financed our operations through internally generated revenue from operations, the sale of our common stock, the issuance of notes and loans from shareholders.
 
We do not have any material commitments for capital expenditures during the next twelve months.  Although our net revenues and proceeds from a recently completed private placement are currently sufficient to fund our operating expenses, we may be required to raise additional funds in the future particularly if we are unable to generate positive cash flow as a result of our operations or require additional capital to expand our operations. Therefore our future operations may be dependent on our ability to secure additional financing.  Financing transactions may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. However, the trading price of our common stock and a downturn in the U.S. equity and debt markets could make it more difficult to obtain financing through the issuance of equity or debt securities. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. The inability to obtain additional capital may restrict our ability to grow and may reduce our ability to continue to conduct business operations. If we are unable to obtain additional financing, we may have to curtail our marketing and development plans and possibly cease our operations.
 
Net cash used in operating activities for the nine months ended September 30, 2011 was $681,604 compared to net cash provided by in operating activities of $9,595 for the nine months ended September 30, 2010.  The increase in net cash used in operating activities was primarily attributable to the $(483,906) of net loss for the period along with an increase of $346,659 in accounts receivable.  Net cash used in investing activities for the nine months ended September 30, 2011 was $61,301 as compared to $2,248 for the nine months ended September 30, 2010. The increase in net cash used in investing activities was due to the purchase of office equipment.  Net cash provided by financing activities for the nine months ended September 30, 2011 was $2,459,466 as compared to net cash used in financing activities of $(40,750) for the nine months ended September 30, 2010. Net cash provided by financing activities was the result of $2,500,000 of proceeds (including conversion of bridge notes) from a private placement that closed on June 24, 2011 partially offset by a decrease of $40,534 in shareholder loans.
 
Off Balance Sheet Arrangements
 
We do not engage in any activities involving variable interest entities or off-balance sheet arrangements.
 
Recent Accounting Pronouncements
 
We do not believe that the adoption of any recently issued accounting standards will have a material effect on our financial position and results of operations.
 
ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
 
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
 
ITEM 4. CONTROLS AND PROCEDURES.
 
 
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
 
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e)) under the Exchange Act) that is designed to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time specified in the Commission's rules and forms. 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 is accumulated and communicated to the issuer's management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
 
Pursuant to Rule 13a-15(b) under the Exchange Act, the Company carried out an evaluation with the participation of the Company's management, including the Company's Chief Executive Officer ("CEO") and the Company's Chief Financial Officer ("CFO"), of the effectiveness of the Company's disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the quarter ended September 30, 2011. Based upon that evaluation, the Company's CEO and CFO concluded that the Company's disclosure controls and procedures were not effective as of September 30, 2011 due to the Company’s limited internal resources and lack of ability to have multiple levels of transaction review.
 
Management is in the process of determining how best to change our current system and implement a more effective system to insure that information required to be disclosed in this quarterly report on Form 10-Q has been recorded, processed, summarized and reported accurately. Our management acknowledges the existence of this problem, and intends to developed procedures to address them to the extent possible given limitations in financial and manpower resources. While management is working on a plan, no assurance can be made at this point that the implementation of such controls and procedures will be completed in a timely manner or that they will be adequate once implemented.
 
CHANGES IN INTERNAL CONTROLS
 
Our management, with the participation our CEO and CFO, performed an evaluation to determine whether any change in our internal controls over financial reporting occurred during the three month period ended September 30, 2011. Based on that evaluation, our CEO and our CFO concluded that no change occurred in the Company's internal controls over financial reporting during the quarter ended September 30, 2011, that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.
 
 PART II--OTHER INFORMATION
 
ITEM 1. LEGAL PROCEEDINGS
 
From time to time, we may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. Litigation is, however, subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe would or could have, individually or in the aggregate, a material adverse effect on us.
 
ITEM 1A. RISK FACTORS
 
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
 
ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
None.
 
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
 
None.
 
ITEM 4 – (REMOVED AND RESERVED.)
 
ITEM 5 - OTHER INFORMATION
 
(a) Form 8-K Information
 
None.
 
 
(b) Director Nomination Procedures
 
We do not have a standing nominating committee nor are we required to have one. We do not have any established procedures by which security holders may recommend nominees to our Board of Directors, however, any suggestions on directors, and discussions of board nominees in general, is handled by the entire Board of Directors.
 
 
ITEM 6 - EXHIBITS.
 
31.1
 
Section 302 Certification of Principal Executive Officer
31.2
 
Section 302 Certification of Principal Financial Officer
32.1*
 
Section 906 Certification of Principal Executive Officer
32.2*
 
Section 906 Certification of Principal Financial Officer
101**
 
The following materials from MEDL Mobile Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011 are formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flow, and (iv) Notes to Consolidated Financial Statements tagged as blocks of text.
 
*
In accordance with Item 601of Regulation S-K, this Exhibit is hereby furnished to the SEC as an accompanying document and is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933.
 
**  
In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
 
 
 
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.
 
 
MEDL Mobile Holdings, Inc.
 
       
       
November 10, 2011
By:  
/s/ Andrew Maltin
 
   
Andrew Maltin
Chief Executive Officer
(Principal Executive Officer)
 
       
       
November 10, 2011
By:  
/s/ David Lieberman
 
   
David Lieberman
Chief Financial Officer
(Principal Financial and Accounting Officer)
 
 
 
EXHIBIT INDEX
 
Exhibit No.
 
Description
     
31.1
 
Section 302 Certification of Principal Executive Officer
31.2
 
Section 302 Certification of Principal Financial Officer
32.1
 
Section 906 Certification of Principal Executive Officer
32.2
 
Section 906 Certification of Principal Financial Officer
101
 
The following materials from MEDL Mobile Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011 are formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flow, and (iv) Notes to Consolidated Financial Statements tagged as blocks of text.