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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

--------------------------------

FORM 10-Q
--------------------------------

(Mark One)
 

x  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 

For The Quarterly Period Ended December 31, 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:  000-27831

MILWAUKEE IRON ARENA FOOTBALL, INC.
(Exact name of registrant as specified in its charter) 

Nevada		91-1947658
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

11415 NW 123 Lane, Reddick, Florida		32686
(Address of principal executive offices)		(zip code)

(718) 554-3652
 (Registrant’s telephone number, including area code)

 (Former Name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X]    No [   ] 
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [   ]    No [   ] 
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. 

Large accelerated filer	[   ]	Accelerated filer	[   ]
Non-accelerated filer	[   ]	Smaller reporting company	[X]
(Do not check if a smaller reporting company)

Indicate by check mark whether the issuer is a shell company (as defined in rule 12b-2 of the Exchange Act) Yes [X]    No [   ] 
 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
 PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required by Section 12, 13, or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court  Yes [   ]     No  [   ] 
 

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
 
As of February 15, 2012, there were 155,892 shares of the Registrant's Common Stock outstanding. 

 

MILWAUKEE IRON ARENA FOOTBALL, INC.

For The Quarterly Period Ended December 31, 2011

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION				3
Item 1.	Financial Statements			3
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations			11
Item 3.	Quantitative and Qualitative Disclosures about Market Risk			15
Item 4.	Controls and Procedures			15
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings			16
Item 1A.	Risk Factors			16
Item 2.	Unregistered Sales Of Equity Securities And Use Of Proceeds.			16
Item 4.	(Removed and Reserved).			16
Item 5.	Other Information			16
Item 6.	Exhibits			17
SIGNATURES				18

THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE   RISKS AND UNCERTAINTIES. SUCH STATEMENTS ARE BASED ON CURRENT EXPECTATIONS, ASSUMPTIONS, ESTIMATES AND PROJECTIONS ABOUT THE COMPANY AND ITS INDUSTRY. FORWARD-LOOKING STATEMENTS ARE SUBJECT TO KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS, LEVELS OF ACTIVITY, PERFORMANCE, ACHIEVEMENTS AND PROSPECTS TO BE MATERIALLY DIFFERENT FROM THOSE  EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS FOR ANY REASON EVEN IF NEW INFORMATION BECOMES AVAILABLE OR OTHER EVENTS OCCUR IN THE FUTURE.
 

PART I - FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

CONTENTS

 

		PAGE(S)
	Balance Sheets as of December 31, 2011(Unaudited) and September 30, 2011	4
	Statements of Operations for the Three Months Ended December 31, 2011 and 2010 (Unaudited)	5
	Statements of Cash Flows for the Three Months Ended December 31, 2011 and 2010 (Unaudited)	6
	Notes to Financial Statements (Unaudited)	7-10

 

 

 

3

MILWAUKEE IRON ARENA FOOTBALL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

 

ASSETS
		DECEMBER 31, 2011				SEPTEMBER 30, 2011
CURRENT ASSETS
Cash and cash equivalents		$	311			$	335
TOTAL CURRENT ASSETS			311				335
TOTAL ASSETS		$	311			$	335
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
CURRENT LIABILITIES
Accounts payable and accrued expenses		$	4,100			$	3,309
Officer Loan			21,309				20,500
Current liabilities of discontinued operations			-				-
TOTAL CURRENT LIABILITIES			25,409				23,809
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock A, $.001 par value; 5,000,000 shares authorized issued and outstanding			5,000				5,000
Preferred stock B, $.001 par value; 5,000,000 shares authorized issued and outstanding			5,000				5,000
Common stock, $.001 par value; 500,000,000
shares authorized 155,892 shares issued and outstanding			156				156
Additional paid-in capital			4,204,067				4,204,067
Accumulated deficit			(4,239,321)				(4,237,697)
TOTAL STOCKHOLDERS' (DEFICIT)			(25,098)				(23,474)
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT)		$	311			$	335

 

4

     

MILWAUKEE IRON ARENA FOOTBALL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED DECEMBER 31, 2011 AND 2010

(Unaudited)

 

		2011				2010
REVENUE		$	-			$	-
OPERATING EXPENSES
General and administrative expenses			1,624				22,576
Credit facility expense - financing agreement			-				-
Total operating expenses			1,624				22,576
NET LOSS		$	(1,624)			$	(22,576)
NET LOSS PER BASIC AND DILUTED SHARES		$	(0.01)			$	(0.05)
WEIGHTED AVERAGE OF COMMON SHARES OUTSTANDING
BASIC AND DILUTED			155,892				432,419

 

 

5

MILWAUKEE IRON ARENA FOOTBALL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED DECEMBER 31, 2011 AND 2010
(Unaudited)

		2011				2010
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(1,624)			$	(22,576)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Changes in assets and liabilities:
Increase (decrease) in accounts payable and accrued expenses			791				6,700
Total adjustments			791				6,700
Net cash used in operating activities			(833)				(15,876)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from officer loan			809				15,900
Net cash provided by financing activities			809				15,900
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			(24)				24
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD			335				335
CASH AND CASH EQUIVALENTS - END OF PERIOD		$	311			$	359
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest paid		$	-			$	-
Income taxes paid		$	-			$	-

6

Milwaukee Iron Professional Arena Football, Inc.

Notes to Financial Statements

December 31, 2011
(Unaudited)

1 – Basis of Presentation

The unaudited, condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). These unaudited condensed consolidated financial statements have been prepared in accordance with the accounting policies described in our audited consolidated financial statements included in our Annual Report on Form 10-K filed with the SEC for the fiscal year ended September 30, 2011 and do not include all information and footnote disclosures included in our audited financial statements. In the opinion of management, the accompanying unaudited, condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly, in all material respects, the consolidated financial condition, results of operations and cash flows for the periods presented. Operating results for the three months ended December 31, 2011 are not necessarily indicative of the results that may be expected for the full fiscal year ending September 30, 2012. Where necessary, information for prior periods has been reclassified to conform to the consolidated financial statement presentation in the current fiscal year. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and accompanying notes included in our 2011 Annual Report on Form 10-K.

2 – Nature of Operations

Milwaukee Iron Arena Football Inc., formerly known as Genesis Capital Corporation of Nevada, (the “Company”), was incorporated in the State of Colorado in 1983.

On January 26, 2010, the Company consummated a merger with Milwaukee Iron Professional Arena Football, LLC and Wisconsin Professional Arena Football Investment LLC (the “Merger”). Prior to the consummation of the Merger, the Company was a non-operating shell company with no revenue and minimal assets. After the Merger, the Company was no longer a shell company and its business operations consisted of those of the Milwaukee Iron arena football team; a member team (the “Team”) of the Arena Football One, a professional arena football league.

Because efforts to fund and develop the Team were not successful, the Company determined that in the interest of our stockholders, it would be advantageous for all parties to unwind the Merger, dispose of the Team and restore operations to that of a shell company seeking an operating business, as described below.

On November 23, 2010, we entered into an Unwind Agreement (the “Unwind Agreement”) with Milwaukee Iron Arena Football Club, Inc. (“Iron Sub”) and certain individuals listed in the Unwind Agreement as Members, whereby the parties mutually agreed to unwind (the “Unwind”) the Merger.

Pursuant to the Unwind Agreement, all of the Members surrendered all of their shares and rights in the Company and the Company conveyed to the Members all shares, rights and ownership interest in Iron Sub (the “Iron Sub Shares”), such that immediately following the Unwind, the Members own all the capital stock of Iron Sub and none of the Members or their assigns own any interest in the Company, affiliates, or properties. In addition, the Company received $40,000 as reimbursement for certain expenses.

As a result of the Unwind, the Company became a shell company whose business strategy again is to enter into a reverse merger with an operating business or develop an operating business through internal growth and/or targeted acquisitions of specific businesses

7

Milwaukee Iron Professional Arena Football, Inc.

Notes to Financial Statements

December 31, 2011
(Unaudited)

3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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. 

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future non confirming events. Accordingly, the actual results could differ significantly from estimates.

Fair Value of Financial Instruments

The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: 

• Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

• Level 2: Inputs reflect: quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.

• Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

8

Milwaukee Iron Professional Arena Football, Inc.

Notes to Financial Statements

December 31, 2011
(Unaudited)

The Company's financial instruments consisted primarily of cash and loans from officer. The carrying amounts of the Company's financial instruments generally approximate their fair values as of December 31, 2011 and 2010, respectively, due to the short-term nature of these instruments.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.

ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented.

4 – GOING CONCERN

As reflected in the accompanying financial statements, the Company has sustained net losses and has a working capital deficit of $25,098, and a stockholders’ deficit of $25,098 at December 31, 2011. In addition the Company has no operating business.

The ability of the Company to continue as a going concern is dependent on its ability to obtain debt or equity based financing and upon future commencement of operations from the development of its planned business.

9

Milwaukee Iron Professional Arena Football, Inc.

Notes to Financial Statements

December 31, 2011
(Unaudited)

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

5 – RELATED PARTY

The loan payable – related party represents amounts advanced to the Company from its Chief Executive Officer. These amounts are non-interest bearing and are due on demand. 

6 – STOCKHOLDERS’ EQUITY (DEFICIT)

As of December 31, 2011 and 2010, the Company had issued 5,000,000 of its preferred stock series A shares and 5,000,000 of its preferred stock series B shares.

On June 22, 2010, the Board of Directors authorized and the Company effectuated a 1 for 50 reverse stock split of the Company’s common stock. The number of authorized shares of the Company’s common stock shall remain at 500,000,000. The par value and other terms of the common stock were not affected by the reverse stock split. The share numbers and per share amounts in the financial statements and the notes to the financial statements reflect the retroactive application of this reverse stock split.

7 – INCOME TAXES

		September 30, 2011			September 30, 2010
Deferred tax assets		$	1,271,796		$	(1,271,309)
Deferred tax valuation allowance			(1,271,796)			1,271,309
Net deferred tax assets		$	-		$	-

Due to the uncertainty of utilizing the approximate $4,239,321 and $4,237,697 in net operating losses, for the years ended September 30, 2011 and 2010, and recognizing the deferred tax assets, an offsetting valuation allowance has been provided.

The Company files tax returns that are subject to audit by tax authorities beginning with the year ended September 30, 2008.The Company’s policy is to classify assessments, if any, for tax and related interest and penalties as tax expense. Tax returns have been filed through the year ended September 30, 2010.
 

 

10

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

THE  FOLLOWING  DISCUSSION  SHOULD  BE READ  IN  CONJUNCTION WITH  THE COMPANY'S  FINANCIAL  STATEMENTS  AND THE  NOTES TO THOSE  STATEMENTS  AND OTHER FINANCIAL INFORMATION APPEARING ELSEWHERE IN THIS REPORT. 

General 

Milwaukee Iron Arena Football Inc., formerly known as Genesis Capital Corporation of Nevada (the “Company” or “we” or “us” or “our”), was incorporated in the State of Colorado in 1983, under the name Bugs, Inc., for the purpose of using microbial and other agents, including metallurgy, to enhance oil and natural gas production and to facilitate the recovery of certain metals. Except as described below, for the past several years, we have had no revenue and have been a shell company. 

On January 26, 2010, we consummated a merger with Milwaukee Iron Professional Arena Football, LLC and Wisconsin Professional Arena Football Investment LLC (collectively, along with their equity owners, the “Merger Partner”) as previously disclosed in our Current Report on Form 8-K filed on February 2, 2010, as subsequently amended on February 16 and February 18, 2010 (the “Merger”).   Upon the closing of the Merger, we amended our articles of incorporation to change our name to Milwaukee Iron Arena Football, Inc. and amended the articles of incorporation of our wholly owned subsidiary to change its name to Milwaukee Iron Arena Football Club, Inc.  Prior to the consummation of the Merger, we were a non-operating shell company with no revenue and minimal assets.  After the Merger, we were no longer a shell company and our business operations consisted of those of the Milwaukee Iron arena football team; a member team (the “Team”) of the Arena Football One, a professional arena football league. 

Because efforts to fund and develop the Team had not been successful, we determined that in the interest of our stockholders, it would be advantageous for all parties to unwind the Merger, dispose of the Team and restore our operations to that of a shell company seeking an operating business. 

Accordingly, on November 23, 2010 (as previously disclosed in our Current Report on Form 8-K filed on December 1, 2010), we entered into an Unwind Agreement whereby the parties thereto mutually agreed to unwind (the “Unwind”) the Merger. 

As a result of the Unwind, we once again became a “shell company” as that term is defined under Federal securities laws.  We intend to seek to acquire assets or shares of an entity actively engaged in business which generates revenues, in exchange for our securities.  Our purpose is to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities presented to us by persons or firms who or which desire to seek the perceived advantages that we may offer.  We will not restrict our search to any specific business, industry, or geographical location and we may participate in a business venture of virtually any kind or nature. This discussion of the proposed business is purposefully general and is not meant to be restrictive of our virtually unlimited discretion to search for and enter into potential business opportunities.  Management anticipates that it may be able to participate in only one potential business venture because we have nominal assets and limited financial resources.
 

11

RESULTS OF OPERATIONS

THREE MONTHS ENDED DECEMBER 31, 2011
COMPARED TO THREE MONTHS ENDED DECEMBER 31, 2010

Revenues 

No revenue was reported for the three months ended December 31, 2011 and 2010 due to our decision to unwind the Merger (as discussed above) and the resulting classification of operations, assets and liabilities associated with the Team as discontinued operations under GAAP.  See Note 2 to the financial statements for more information regarding the discontinued operations. 

Operating Expenses 

Operating expenses for the three months ended December 31, 2011 were $1,624 compared to $22,576 for the three months ended December 31, 2010.  Operating expenses decreased primarily due to the reduction of expenses following the consummation of the Unwind and our lack of operations. 

Loss From Continuing Operations 

We had an operating loss from continuing operations of $1,624 for the three month period ended December 31, 2011 as compared to a loss from continuing operations of $22,576 for the three month period ended December 31, 2010.  

 

12

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2011 we had: (i) total assets of $311, consisting of cash, (ii) total liabilities of $25,409, comprised of an officer loan of $21,309 and accounts payable and current expenses of $4,100, (iii) a working capital deficit of $25,098 and (iv) an accumulated deficit of $4,239,321. 

As of December 31, 2011 we owed our officer $21,309, which represents amounts advanced to, or on behalf of, the Company.  This debt has no specific re-payment terms and is due on demand. 

Since the Unwind of the Merger, we have had no source of revenues from which to pay our operating expenses.  We have obtained working capital from related party debt, and will require additional capital from the sale of our securities, debt and/or from other sources in order to pay our current obligations. There can be no assurance that we will be successful in these efforts.

Net cash used in operating activities for the three months ended December 31, 2011 was $833, which included an increase in accounts payable and accrued expenses of $791; compared to net cash used in operating activities of $15,876 for the three months ended December 31, 2010, which included an increase in accounts payable and accrued expenses of $6,700.

Net cash provided by financing activities for the three months ended December 31, 2011 was $809 compared to net cash provided by financing activities for the three months ended December 31, 2010 of $15,900, which resulted in proceeds of a loan from officer.

Cash Requirements

At December 31, 2011 we had an accumulated deficit of $4,239,321. The report from our independent registered public accounting firm on our audited financial statements at September 30, 2011, contains an explanatory paragraph regarding doubt as to our ability to continue as a going concern. We are seeking to acquire assets or shares of an entity actively engaged in business which generates revenues, in exchange for our securities.  We cannot predict when, if ever, we will be successful in this venture and, accordingly, we may be required to cease operations at any time.  We do not have sufficient working capital to pay our operating costs for the next 12 months and we will require additional funds to pay our legal, accounting and other fees associated with our company and its filing obligations under federal securities laws, as well as to pay our other accounts payable generated in the ordinary course of our business.  We have no commitments from any party to provide such funds to us.  If we are unable to obtain additional capital as necessary until such time as we are able to conclude a business combination, we will be unable to satisfy our obligations and otherwise continue to meet our reporting obligations under federal securities laws.  In that event, our stock would no longer be quoted on the OTC Bulletin Board and our ability to consummate a business combination with upon terms and conditions which would be beneficial to our existing stockholders would be adversely affected.
 

 

13

We currently plan to satisfy our cash requirements for the next 12 months by borrowing from affiliated companies with common ownership or control or directly from our officers and directors and we believe we can satisfy our cash requirements so long as we are able to obtain financing from these parties.  We currently expect that money borrowed will be used during the next 12 months to satisfy our operating costs, professional fees and for general corporate purposes. We have also been exploring alternative financing sources. 

We will use our limited personnel and financial resources in connection with seeking new business opportunities, including seeking an acquisition or merger with an operating company. It may be expected that entering into a new business opportunity or business combination will involve the issuance of a substantial number of restricted shares of common stock. If such additional restricted shares of common stock are issued, our shareholders will experience a dilution in their ownership interest. If a substantial number of restricted shares are issued in connection with a business combination, a change in control may be expected to occur.

In connection with the plan to seek new business opportunities and/or effecting a business combination, we may determine to seek to raise funds from the sale of restricted stock or debt securities. We have no agreements to issue any debt or equity securities and cannot predict whether equity or debt financing will become available at acceptable terms, if at all.

There are no limitations in our certificate of incorporation restricting our ability to borrow funds or raise funds through the issuance of restricted common stock to effect a business combination. Our limited resources and lack of recent operating history may make it difficult to borrow funds or raise capital. Such inability to borrow funds or raise funds through the issuance of restricted common stock required to effect or facilitate a business combination may have a material adverse effect on our financial condition and future prospects, including the ability to complete a business combination. To the extent that debt financing ultimately proves to be available, any borrowing will subject us to various risks traditionally associated with indebtedness, including the risks of interest rate fluctuations and insufficiency of cash flow to pay principal and interest, including debt of an acquired business.

Off-Balance Sheet Arrangements.

We currently do not have any off-balance sheet arrangements. 
 

14

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES 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 information under this item.

ITEM 4. CONTROLS AND PROCEDURES 

Evaluation of Disclosure Controls and Procedures 

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of December 31, 2010.  Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective as of such date, at a reasonable level of assurance, in ensuring that the information required to be disclosed by the Company in the reports we file or submit under the Exchange Act is: (i) accumulated and communicated to our management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Internal Control Over Financial Reporting 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f).  Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.  Based on our evaluation, management has concluded that our internal control over financial reporting was effective as of December 31, 2011.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.  This report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting pursuant to temporary rules of the Securities and Exchange Commission.

Changes in Internal Control Over Financial Reporting 

There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

15

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS 

We are not a party to any pending legal proceedings nor is any of our property the subject of any pending legal proceedings. 

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 information under this item. 

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

ITEM 3. DEFAULTS UPON SENIOR SECURITIES 

none 

ITEM 4. (REMOVED AND RESERVED). 

ITEM 5. OTHER INFORMATION 

none 

16

ITEM 6. EXHIBITS 

EXHIBIT NUMBER		DESCRIPTION
31.1		Certification of Principal Executive Officer pursuant to Sarbanes-Oxley Section 302
32.1		Certification of Chief Executive Officer pursuant to Sarbanes-Oxley Section 906

 

 

 

 

 

 

 

 

 

 

 

 

17

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.
 

	By:	/s/ RICHARD ASTROM
Date:  February 21, 2012		Name: Richard Astrom
		Title: Chief Executive Officer, Principal Accounting Officer, President, Director