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EX-32 - CERTIFICATION - EV Charging USA, INCmi_ex321-130630.htm
EX-31 - CERTIFICATION - EV Charging USA, INCmi_ex311-130630.htm

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 June 30, 2013 

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) 236-6434
 (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 June 30, 2013, there were 155,892 shares of the Registrant's Common Stock outstanding. 


MILWAUKEE IRON ARENA FOOTBALL, INC.
For The Quarterly Period Ended June 30, 2013

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

 

 

10

 

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

 

 

13

 

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

 

13

 

 

 

 

 

 

 

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 4.

(Removed and Reserved).

 

 

14

 

 

 

 

 

 

 

Item 5.

Other Information

 

 

14

 

 

 

 

 

 

 

Item 6.

Exhibits

 

 

14

 

 

 

 

 

 

 

SIGNATURES

 

 

15

 




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

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

 

JUNE 30,
2013

SEPTEMBER 30,
2012

ASSETS

CURRENT ASSETS

   

Cash

$

270

$

270

TOTAL CURRENT ASSETS

 

270

 

270

     

TOTAL ASSETS

$

270

$

270

     
     

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

   
     

CURRENT LIABILITIES

   
     

Accounts payable and accrued expenses

$

11,248

$

6,748

Loan payable - related party

 

29,536

 

27,736

TOTAL CURRENT LIABILITIES

40,784

34,484

     

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

 

(4,254,737)

 

 

(4,248,437)

 

TOTAL STOCKHOLDERS' (DEFICIT)

 

(40,514)

 

 

(34,214)

 

     

TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT)

$

270

$

270



 

3

MILWAUKEE IRON ARENA FOOTBALL, INC.
CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS ENDED JUNE 30, 2013 AND 2012
(unaudited)

 

Three Months Ended June 30,

Nine Months Ended June 30,

 

2013

2012

2013

2012

         

OPERATING EXPENSES

       

     General and administrative expenses

 

2,100

 

2,016

 

6,300

 

6,418

         

          Total operating expenses

 

2,100

 

2,016

 

6,300

 

6,418

         
         

NET LOSS

$

(2,100)

$

(2,016)

$

(6,300)

$

(6,418)

         

NET LOSS PER BASIC AND DILUTED SHARES

$

(0.01)

$

(0.01)

$

(0.04)

$

(0.04)

WEIGHTED AVERAGE OF COMMON SHARES OUTSTANDING

       

     BASIC AND DILUTED

 

155,892

 

155,892

 

155,892

 

155,892



 

4

MILWAUKEE IRON ARENA FOOTBALL, INC.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED JUNE 30, 2013 AND 2012
(unaudited)

 

Nine Months Ended June 30,

 

2013

2012

     

CASH FLOWS FROM OPERATING ACTIVITIES

   

    Net loss

$

(6,300)

 

$

(6,418)

 

     

Adjustments to reconcile net income (loss) to net cash

   

provided by (used in) operating activities:

   
     

Changes in assets and liabilities:

   

Increase (decrease) in liabilities

   

     Increase (decrease) in accounts payable and accrued expenses

 

4,500

 

2,617

     

Total adjustments

 

4,500

 

2,617

     

Net cash (used in) operating activities

 

(1,800)

 

 

(3,801)

 

     
     

CASH FLOWS FROM FINANCING ACTIVITIES

   

     Proceeds from officer loan

 

1,800

 

3,736

     

Net cash provided by financing activities

1,800

3,736

     
     

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

-

(65)

 

     

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD

 

270

 

335

     

CASH AND CASH EQUIVALENTS - END OF PERIOD

$

270

$

270




5

Milwaukee Iron Professional Arena Football, Inc.
Notes to Financial Statements
June 30, 2013
(Unaudited)

1 – Basis of Presentation

The unaudited, condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). These unaudited condensed financial statements have been prepared in accordance with the accounting policies described in our audited financial statements included in our Annual Report on Form 10-K filed with the SEC for the fiscal year ended September 30, 2012 and do not include all information and footnote disclosures included in our audited financial statements. In the opinion of management, the accompanying unaudited, condensed financial statements include all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly, in all material respects, the financial condition, results of operations and cash flows for the periods presented. Operating results for the three and nine months ended June 30, 2013 are not necessarily indicative of the results that may be expected for the full fiscal year ending September 30, 2013 or any other period. Where necessary, information for prior periods has been reclassified to conform to the financial statement presentation in the current fiscal year. These unaudited condensed financial statements should be read in conjunction with our audited financial statements and accompanying notes included in our 2012 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. 

We are a shell company whose business strategy 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.

6

Milwaukee Iron Professional Arena Football, Inc.
Notes to Financial Statements
June 30, 2013
(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.

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 June 30, 2013 and September 30, 2012, due to the short-term nature of these instruments.

7

Milwaukee Iron Professional Arena Football, Inc.
Notes to Financial Statements
June 30, 2013
(Unaudited)

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 $40,514, and a stockholders’ deficit of $40,514 at June 30, 2013. In addition, the Company has no operating business. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern.

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.

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 June 30, 2013 and September 30, 2012, the Company had issued 5,000,000 shares of its Series A Preferred Stock, par value $0.001 per share, and 5,000,000 shares of its Series A Preferred Stock, par value $0.001 per share, and 155,892 shares of common stock, par value $0.001 per share.

There were 500,000,000 shares of common stock authorized, with 155,892 shares issued and outstanding at June 30, 2013 and September 30, 2012, respectively. The par value for the common stock is $.001 per share.

8

Milwaukee Iron Professional Arena Football, Inc.
Notes to Financial Statements
June 30, 2013
(Unaudited)

7 – INCOME TAXES

 

June 30,
2013

September 30,
2012

     

Deferred tax assets

$

(1,019,100)

$

(1,016,900)

Deferred tax valuation allowance

 

1,019,100

 

1,016,900

     

Net deferred tax assets

$

-

$

-



Due to the uncertainty of utilizing the approximate $2,911,800 and $2,905,500 in net operating losses, as of June 30, 2013 and September 30, 2012, and recognizing the deferred tax assets, an offsetting valuation allowance been provided, a nondeductible carry forward loss from prior years for the amount of $1,342,937, which is not included in the calculation.

The Company files tax returns that are subject to audit by tax authorities beginning with the year ended September 30, 2009.The Company’s policy is to classify assessments, if any, for tax and related interest and penalties as tax expense.

8 – SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, The Company has analyzed its operations subsequent to June 30, 2013 to the date these financial statements were issued, and has determined that it does not have material subsequent events to disclose in these financial statements.

9

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.

For the past several years, we have had no revenue and have been a shell company. 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.

RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2013
COMPARED TO THREE MONTHS ENDED JUNE 30, 2012

Revenues 

Revenues for the three months ended June 30, 2013, were $0.00 compared to $0.00 for the three months ended June 30, 2012. No revenue was reported for these periods because we are a non-operating company.

Operating Expenses 

Operating expenses for the three months ended June 30, 2013, were $2,100 compared to $2,016 for the three months ended June 30, 2012. Operating expenses decreased slightly due to lower general and administrative expenses. 

Net Loss

We had a net loss from continuing operations of $2,100 for the three-month period ended June 30, 2013 as compared to a loss from continuing operations of $2,016 for the three-month period ended June 30, 2012.

10

NINE MONTHS ENDED JUNE 30, 2013
COMPARED TO NINE MONTHS ENDED JUNE 30, 2012

Revenues 

Revenues for the nine months ended June 30, 2013, were $0.00 compared to $0.00 for the nine months ended June 30, 2012. No revenue was reported for these periods because we are a non-operating company.

Operating Expenses 

Operating expenses for the nine months ended June 30, 2013, were $6,300 compared to $6,418 for the nine months ended June 30, 2012. Operating expenses decreased primarily due to lower operating expenses. 

Net Loss

We had an operating loss from continuing operations of $6,300 for the nine month period ended June 30, 2013, as compared to a loss from continuing operations of $6,418 for the nine month period ended June 30, 2012. 

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2013, we had: (i) total assets of $270, consisting of cash, (ii) total liabilities of $40,784, comprised primarily of an officer loan (iii) a working capital deficit of $40,514 and (iv) an accumulated deficit of $4,254,737.

As of June 30, 2013, we owed our officer $29,536, which represents amounts advanced to, or on behalf of, the Company. This debt has no specific repayment terms and is due on demand. 

For the past several years, 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 nine months ended June 30, 2013, was $0, compared to net cash used in operating activities of $3,801 for the nine months ended June 30, 2012. 

Net cash provided by financing activities for the nine months ended June 30, 2013, was $1,800, compared to net cash provided by financing activities for the nine months ended June 30, 2012 of $3,736.

11

Cash Requirements

At June 30, 2013, we had an accumulated deficit of $4,254,737. The report from our independent registered public accounting firm on our audited financial statements at September 30, 2012, contains an explanatory paragraph regarding doubt as to our ability to continue as a going concern. As discussed earlier in this report, 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 could be adversely affected.

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. 

12

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 

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 Exchange Act as of June 30, 2013. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were not effective as of such date, at a reasonable level of assurance, in ensuring that the information required to be disclosed by our 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) and 15d-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”).

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 not effective as of June 30, 2013. 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.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. In connection with our assessment of our internal control over financial reporting as required under Section 404 of the Sarbanes-Oxley Act of 2002, we identified the following material weaknesses in our internal control over financial reporting as of June 30, 2013:

    • We have difficulty in accounting for complex accounting transactions particularly as it relates to complex equity transactions.
    • Documented processes do not exist for several key processes

Because of the material weaknesses noted above, we have concluded that we did not maintain effective internal control over financial reporting as of June 30, 2013, based on Internal Control over Financial Reporting – Guidance for Smaller Public Companies issued by COSO.

13

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.

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



14

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 S. ASTROM

 

Date: July 29, 2013

 

Name: Richard S. Astrom

 

 

 

Title: Chief Executive Officer, Principal Accounting Officer, President, Director

 



     

 

 

 

 

 

 

 

15