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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarter ended: May 31, 2013

 

OR

 

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: 001-35757

 

EAST SHORE DISTRIBUTORS, INC.

(Exact name of registrant as specified in its charter)

 

Nevada

27-2838091

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

 

1020 Fourth Avenue

Wall Township, NJ 07719

(Address of principal executive offices and zip code)

 

(732) 414-7302

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ 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, or 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

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

As of July 8, 2013, there were 39,755,000 shares outstanding of the registrant’s common stock.

 

 
 

 

 

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION

 

 

 

Item 1.

Financial Statements.

  1

 

 

 

Item 2.

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

  10

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

  12

 

 

 

Item 4.

Controls and Procedures.

  12

 

 

 

PART II – OTHER INFORMATION

 

 

 

Item 1.

Legal Proceedings.

14

 

 

 

Item 1A.

Risk Factors.

14

 

 

 

Item 2

Unregistered Sales of Equity Securities and Use of Proceeds.

  14

 

 

 

Item 3

Defaults Upon Senior Securities.

  14

 

 

 

Item 4.

Mine Safety Disclosures.

  14

 

 

 

Item 5.

Other Information.

  14

 

 

 

Item 6.

Exhibits.

  14

 

 

 

Signatures

15

 

 
 

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Financial Statements

May 31, 2013

(Unaudited)

  

 
 

 

 

CONTENTS

                                                                                                   

 

 

 Page(s)

Balance Sheets – May 31, 2013 (Unaudited) and February 28, 2013

 1

 

Statements of Operations – Three Months Ended May 31, 2013 and 2012, and from June 11, 2010 (Inception) to May 31, 2013 (Unaudited)     

 2

 

Statement of Stockholders’ Equity (Deficit) – June 11, 2010 (Inception) to May 31, 2013 (Unaudited)   

 3

 

Statements of Cash Flows – Three Months Ended May 31, 2013 and 2012, and June 11, 2010 (Inception) to May 31, 2013 (Unaudited)

 4

 

Notes to Financial Statements (Unaudited)     

 5 - 9

 
 

 

 

East Shore Distributors, Inc.

 (A Development Stage Company)

Balance Sheets

 

 

May 31, 2013

February 28, 2013

 

(Unaudited)

       

Assets

               
                 

Current Assets

               

Cash

  $ 4,252   $ 11,177

Total Current Assets

    4,252     11,177
                 

Total Assets

  $ 4,252   $ 11,177
                 

Liabilities and Stockholders' Deficit

               
                 

Current Liabilities

               

Accounts payable

  $ 5,500   $ 3,500

Loans payable - related party

    24,000     24,000

Total Current Liabilities

    29,500     27,500
                 

Stockholders' Deficit

               

Preferred stock, $0.0001 par value; 10,000,000 shares authorized; none issued and outstanding

    -     -

Common stock, $0.0001 par value, 100,000,000 shares authorized; 39,755,000 shares issued and outstanding

    3,976     3,976

Additional paid-in capital

    18,724     18,724

Deficit accumulated during the development stage

    (47,948 )     (39,023 )

Total Stockholders' Deficit

    (25,248 )     (16,323 )
                 

Total Liabilities and Stockholders' Deficit

  $ 4,252   $ 11,177

 

See accompanying notes to financial statements

 

 
1

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Statements of Operations

(Unaudited)

 

 

Three Months Ended May 31,

 

June 11, 2010 (Inception) to May 31, 2013

 

2013

2012

Revenue

  $ -   $ 55,805   $ 219,660
                         

Cost of revenue

    -     45,735     184,584
                         

Gross profit

    -     10,070     35,076
                         

General and administrative expenses

    8,925     9,160     83,024
                         

Net income (loss)

  $ (8,925 )   $ 910   $ (47,948 )
                         

Net loss per common share - basic and diluted

  $ (0.00 )   $ 0.00   $ (0.00 )
                         

Weighted average number of common shares outstanding during the period - basic and diluted

    39,755,000     39,755,000     38,320,954

  

See accompanying notes to financial statements

 

 
2

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Statement of Stockholders' Equity (Deficit)

From June 11, 2010 (Inception) to May 31, 2013

(Unaudited)

 

Common Stock, $0.0001 Par Value

 

Additional

Paid In

Capital

Deficit

Accumulated during

Development Stage

Total

Stockholders'

Equity (Deficit)

 

Shares

Amount

                                         

Issuance of common stock - founder ($0.0001/share)

    36,000,000   $ 3,600   $ -   $ -   $ 3,600
                                         

Net income from June 11, 2010 (inception) to February 28, 2011

    -     -             645     645
                                         

Balance - February 28, 2011

    36,000,000     3,600     -     645     4,245
                                         

Issuance of common stock ($0.001/share)

    3,600,000     360     3,240     -     3,600
                                         

Issuance of common stock ($0.10/share)

    155,000     16     15,484     -     15,500
                                         

Net loss - 2012

    -     -     -     (19,684 )     (19,684 )
                                         

Balance - February 29, 2012

    39,755,000     3,976     18,724     (19,039 )     3,661
                                         

Net loss - 2013

    -     -     -     (19,984 )     (19,984 )
                                         

Balance - February 28, 2013

    39,755,000     3,976     18,724     (39,023 )     (16,323 )
                                         

Net loss for the three months ended May 31, 2013

    -     -     -     (8,925 )     (8,925 )
                                         

Balance - May 31, 2013

    39,755,000   $ 3,976   $ 18,724   $ (47,948 )   $ (25,248 )

 

See accompanying notes to financial statements

 

 
3

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Statements of Cash Flows

(Unaudited)

 

 

Three Months Ended May 31,

June 11, 2010 (Inception) to

May 31, 2013

 

2013

2012

   

CASH FLOWS FROM OPERATING ACTIVITIES:

                       

Net income (loss)

  $ (8,925 )   $ 910   $ (47,948 )

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

                       

Changes in operating assets and liabilities:

                       

(Increase)/Decrease in:

                       

Inventory

    -     45,735     -

Increase/(Decrease) in:

                       

Accounts payable

    2,000     (41,735 )     5,500

Customer deposit

    -     10,800     -

Net Cash Provided By (Used In) Operating Activities

    (6,925 )     15,710     (42,448 )
                         

CASH FLOWS FROM FINANCING ACTIVITIES:

                       

Proceeds from loans payable - related party

    -     -     24,000

Proceeds from issuance of common stock - founder

    -     -     3,600

Proceeds from issuance of common stock

    -     -     19,100

Net Cash Provided By Financing Activities

    -     -     46,700
                         

Net increase (decrease) in Cash

    (6,925 )     15,710     4,252
                         

Cash - Beginning of Period

    11,177     13,661     -
                         

Cash - End of Period

  $ 4,252   $ 29,371   $ 4,252
                         

SUPPLEMENTARY CASH FLOW INFORMATION:

                       

Cash Paid During the Period for:

                       

Income Taxes

  $ -   $ -   $ 97

Interest

  $ -   $ -   $ -
                         

SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

                       
                         

Stock issued for subscription receivable

  $ -   $ -   $ -

 

See accompanying notes to financial statements

 

 
4

 

  

East Shore Distributors, Inc.

(A Development Stage Company)

Notes to Financial Statements

May 31, 2013

(Unaudited)

 

Note 1 – Basis of Presentation

 

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial information.

 

The financial information as of February 28, 2013 is derived from audited financial statements presented in the Company’s Annual Report on Form 10-K for the year ended February 28, 2013. The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K, which contains the audited financial statements and notes thereto, together with the Management’s Discussion and Analysis, for the year ended February 28, 2013.

 

Certain information or footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted, pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, 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 interim results for the period ended May 31, 2013, are not necessarily indicative of results for the full fiscal year.

 

Note 2 Nature of Operations and Summary of Significant Accounting Policies

 

Nature of Operations

 

East Shore Distributors, Inc. (the “Company”), was incorporated in the State of Nevada on June 11, 2010. The Company’s focus is distributing a variety of consumer products.

 

Development Stage

 

The Company’s financial statements are presented as those of a development stage enterprise. Activities during the development stage primarily include debt and equity based financing and implementation of the business plan. The Company has not generated a significant amount of revenues from operations since inception.

 

Revenue Recognition

 

The Company records revenue when all of the following have occurred: (1) persuasive evidence of an arrangement exists; (2) product delivery has occurred; (3) the sales price to the customer is fixed or determinable; and (4) collectability is reasonably assured. Depending on the relationship with the customer, the Company recognizes revenue upon shipment or arrival at destination. There is no stated right to return and there have been no returns.

 

 
5

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Notes to Financial Statements

May 31, 2013

(Unaudited)

 

The Company reported revenues from the following countries:

 

 

Three Months

Ended

May 31,

2013

%

Three

Months

Ended

May 31,

2012

%

June 11,

2010

(Inception)

to

May 31,

2013

%

United States

  $ -     -   $ 55,805     100 %   $ 198,660     90 %

Brazil

    -     -     -     -     21,000     10 %

Total

  $ -     -   $ 55,805     100 %   $ 219,660     100 %

 

The Company’s sales concentrations for the three months ended May 31, 2013 and 2012, respectively, is as follows:

 

Customer

2013

2012

A

    - %     100 %

B

    - %     - %

 

Risks and Uncertainties

 

The Company intends to operate in an industry that is subject to rapid change. The Company’s operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory and other risks, including the potential risk of business failure.

 

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 confirming events. Accordingly, the actual results could differ significantly from estimates.

 

Cash and Cash Equivalents

 

 
6

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Notes to Financial Statements

May 31, 2013

(Unaudited)

 

The Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. At May 31, 2013 and February 28, 2013, the Company had no cash equivalents.

 

Earnings per Share

 

Basic earnings (loss) per share (“EPS”) is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock warrants, using the treasury stock method (by using the average stock price for the period determine the number of shares assumed to be purchased from the exercise of warrants), and convertible debt, using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive. The Company had no common stock equivalents since inception.

 

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; and

 

  

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.

 

The Company’s financial instruments consisted primarily of cash, accounts payable and loan payable – related party. The carrying amounts of the Company’s financial instruments generally approximate their fair values as of May 31, 2013 and February 28, 2013, due to the short-term nature of these instruments.

 

 
7

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Notes to Financial Statements

May 31, 2013

(Unaudited)

 

Recent Accounting Pronouncements

 

There are no recent accounting pronouncements expected to affect the Company.

 

Note 3 Going Concern

 

As reflected in the accompanying financial statements, the Company has a net loss of $8,925 and net cash used in operations of $6,925 for the three months ended May 31, 2013, and a working capital deficit of $22,700 and stockholders’ deficit of $25,248 at May 31, 2013. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

The ability of the Company to continue its operations is dependent on Management’s plans, which may include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements. The Company may need to incur liabilities with certain related parties to sustain the Company’s existence.

 

The Company will require additional funding to finance the growth of its current and expected future operations as well as to achieve its strategic objectives. The Company believes its current available cash along with anticipated revenues may be insufficient to meet its cash needs for the near future. There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all.

 

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.

 

Note 4 Loan Payable – Related Party

 

During November 2010, the Company’s Chief Executive Officer advanced $3,000. The loan is non-interest bearing, unsecured and due on demand.

 

During June 2012, the Company’s Chief Executive Officer advanced $9,000. The loan is non-interest bearing, unsecured and due on demand.

 

During October 2012, the Company’s Chief Executive Officer advanced $12,000. The loan is non-interest bearing, unsecured and due on demand.

 

Note 5 Stockholders’ Equity (Deficit)

 

 
8

 

 

East Shore Distributors, Inc.

(A Development Stage Company)

Notes to Financial Statements

May 31, 2013

(Unaudited)

 

In June 2010, the Company issued 36,000,000 shares of common stock to its founder for $3,600. ($0.0001/share).

 

In July 2011, the Company issued 3,600,000 shares of common stock for $3,600 ($0.001/share).

 

In August and September 2011, the Company issued 155,000 shares of common stock for $15,500 ($0.10/share).

 

 
9

 

 

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

 

THE FOLLOWING DISCUSSION OF OUR PLAN OF OPERATION AND RESULTS OF OPERATIONS SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND RELATED NOTES TO THE FINANCIAL STATEMENTS INCLUDED ELSEWHERE IN THIS REPORT. THIS DISCUSSION CONTAINS FORWARD-LOOKING STATEMENTS THAT RELATE TO FUTURE EVENTS OR OUR FUTURE FINANCIAL PERFORMANCE. THESE STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE OUR ACTUAL RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY THESE FORWARD-LOOKING STATEMENTS.

 

Plan of Operation

 

Our plan of operations over the next twelve months includes (i) the continued marketing and selling of our existing product line to purchasers in the United States and South American markets; (ii) the development of our website to enable e-commerce transactions and (iii) expanding our product offerings to include other unique products.  In order to implement our plan of operation, we will need to obtain outside funding or additional funding from our Chief Executive Officer.

 

Currently and for the foreseeable future, the Company will continue to use third parties to manufacture the products the Company sells to its customers. The Company will continue to source and discretely select the best manufacturers able to deliver high quality, reliable, safe and effective products.

 

The Company believes that it will need a minimum of $100,000 to cover its planned operations over the next 12 months. This estimate includes (i) $40,000 for product marketing, including exhibiting our products at various trade shows; (ii) $20,000 for research and development costs; and (iii) and $40,000 for general and administrative costs.

 

Results of Operations

 

For the Three Months Ended May 31, 2013, Compared to the Three Months Ended May 31, 2012

 

Revenue

 

For the three months ended May 31, 2013, revenue from operations were $0, compared to $55,805 for the three months ended May 31, 2012, a decrease of $55,805. The decrease is related to a decrease in demand and sales of our products. Since inception on June 11, 2010 to November 30, 2012, our revenue from operations was $219,660.

 

Cost of Revenue

 

Our cost of revenue for the three months ended May 31, 2013, was $0, compared to $45,735 for the three months ended May 31, 2012. The $45,735 decrease is related to a decrease in the sales of our products. Since inception on June 11, 2010 to May 31, 2013, our total cost of revenue was $184,584.

 

Gross Profit

 

For the three months ended May 31, 2013, gross profit from sales, before taking into account general and administrative expenses was $0, compared to $10,070 for the three months ended May 31, 2012, resulting in a decrease of $10,070. The decrease is related to a decrease in the sales of our products. Since inception on June 11, 2010 to May 31, 2013, gross profit from sales was $35,076.

 

General and Administrative Expenses

 

General and administrative expenses for the three months ended May 31, 2013, was $8,925, resulting in a net loss of $(8,925), compared to general and administrative expenses of $9,160 for the three months ended May 31, 2012, which resulted in a net income of $910. Since inception on June 11, 2010 to May 31, 2013, general and administrative fees were $83,024, resulting in a net loss since inception of $(47,948).

 

 
10

 

 

Liquidity & Capital Resources

 

As of May 31, 2013, the Company had a cash balance of $4,252. On July 29, 2011, the Company sold an aggregate of 3,600,000 shares of its common stock to 3 investors for a total consideration of $3,600.  On August 30, 2011, the Company commenced a private placement for up to 1,000,000 shares of its common stock, of which the Company sold only 155,000 shares for total consideration of $15,500. The Company believes that such funds will be insufficient to fund its expenses over the next twelve months. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

 

On November 22, 2010, Mr. Fridman, the Company’s Chief Executive Officer, loaned the Company $3,000 cash in exchange for a promissory note. On June 19, 2012, Mr. Fridman loaned the Company an additional $9,000 cash in exchange for a promissory note. On October 18, 2012, Mr. Fridman loaned the Company an additional $12,000 cash in exchange for a promissory note. These notes are non-interest bearing, unsecured and due on demand. At this time, the Company has not paid back any portion of the loan. Mr. Fridman has orally agreed to lend additional funds to the Company in the event capital is required for the operations of the Company.

 

However, there is no guarantee that our Chief Executive Officer will lend us the funds we need to continue our operations. There is no minimum or maximum amount of funds that the Chief Executive Officer agreed to lend. Since our Chief Executive Officer is committed to ensuring that the Company can operate its business, they have each agreed to be responsible for this Company’s operating expenses for the next 12 months if outside financing is not available. Notwithstanding that our Chief Executive Officer is committed to ensuring that the Company can operate its business, Mr. Fridman is not legally or contractually obligated to lend us any money.  Since the Company has no such arrangements or plans currently in effect, its inability to raise funds for the above purposes will have a severe negative impact on its ability to remain a viable company.  We currently have no commitments with any person for any capital expenditures.

 

Using an annualized figure of approximately $30,000 for our general and administrative expenses, including professional and legal services (e.g. bookkeeping, audit costs, attorney fees, advertising, transfer agent and EDGAR services), costs are approximately $2,500 a month. Given the amount of cash currently on hand, we expect our current cash reserves to last for approximately two months.

 

Over the next 12 months would like to raise a minimum of $100,000 and a maximum of $200,000 in order to continue our marketing plan and expand our customer base. To achieve our goals, a large portion of the funds raised will be invested in advertising, marketing, travel and product development expenses. Our success is contingent upon having enough capital to build a strong customer base to support the business. We hope to raise additional funds within the next six months. A private placement is the most likely scenario for the Company to achieve success in raising additional funds for its operations.  There are no discussions with any parties at this point in time for additional funding; however, we will attempt to discuss our business plan with various brokers in the U.S.

 

Completion of our plan of operations is subject to attaining adequate revenue. We cannot assure investors that adequate revenues will be generated.  In the absence of our projected revenues, we may be unable to proceed with our plan of operations. Even without adequate revenues within the next twelve months, we still anticipate being able to continue with our present activities, but we may require financing to achieve our profit, revenue, and growth goals.

 

We anticipate that our operational, and general and administrative expenses for the next 12 months will total approximately $100,000. These expenses will be financed through the Company’s cash on hand of $4,252 as of May 31, 2013, plus approximately $95,000 in capital raised from future sales of our common stock. We do not anticipate the purchase or sale of any equipment. We also do not expect any significant additions to the number of employees, unless adequate financing is raised. The foregoing represents our best estimate of our cash needs based on current planning and business conditions. The exact allocation, purposes and timing of any monies raised in subsequent private financings may vary significantly depending upon the exact amount of funds raised and our progress with the execution of our business plan.

 

 
11

 

 

Critical Accounting Policies and Estimates

 

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition.  We believe our use if estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

 

Our significant accounting policies are summarized in Note 2 of our financial statements.  While all these significant accounting policies impact its financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates.  Actual results may differ from those estimates.  Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our results of operations, financial position or liquidity for the periods presented in this report.

 

Recent Accounting Pronouncements

 

There are no recent accounting pronouncements expected to affect the Company.

 

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

We do not hold any derivative instruments and do not engage in any hedging activities.

 

Item 4. Controls and Procedures.

 

(a) Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in the reports we file pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”), to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide a reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Management designed the disclosure controls and procedures to provide reasonable assurance of achieving the desired control objectives.

 

We carried out an evaluation, under the supervision and with the participation of our management, including our PEO and PFO, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this quarterly report.  Based upon that evaluation, the PEO and PFO concluded that the Company’s disclosure controls and procedures were effective.

 

 
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(b) Changes in Internal Control over Financial Reporting

 

There have been no changes in our internal controls over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act) during the quarter ended May 31, 2013, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 
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PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

 

Item 1A. Risk Factors.

 

We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K, filed with the SEC on May 29, 2013.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

Not applicable.

 

Item 3. Defaults Upon Senior Securities.

 

There were no defaults upon senior securities during the quarter ended May 31, 2013.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

Item 5. Other Information.

 

There is no other information required to be disclosed under this item which was not previously disclosed.

 

Item 6. Exhibits.

 

Exhibit No.

Description

 

  

31.1

Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002 *

 

  

31.2

Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002 *

 

  

32.1

Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *

 

  

32.2

Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *

   

101.INS

XBRL Instance **

   

101.SCH

XBRL Taxonomy Extension Schema **

   

101.CAL

XBRL Taxonomy Extension Calculation **

   

101.DEF

XBRL Taxonomy Extension Definition **

   

101.LAB

XBRL Taxonomy Extension Labels **

   

101.PRE

XBRL Taxonomy Extension Presentation **

 

* filed herewith

 

** XBRL

Information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 
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SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

     

EAST SHORE DISTRIBUTORS, INC.

           
           

Date: July 10, 2013

 

By:

/s/ Alex Fridman

 
       

Name: Alex Fridman

 
       

Title: Chief Executive Officer

          (Principal Executive Officer)

          (Principal Financial Officer)

          (Principal Accounting Officer)

 

 

 

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