PMX Communities, Inc. - FORM 10-K

Attached files

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EX-31 - EXHIBIT 31 - PMX Communities, Inc.	pmx10k13ex31.htm
EX-32 - EXHIBIT 32 - PMX Communities, Inc.	pmx10k13ex32.htm
EXCEL - IDEA: XBRL DOCUMENT - PMX Communities, Inc.	Financial_Report.xls

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2013

[ ] 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: 000-53974

PMX COMMUNITIES, INC.

(Exact name of Registrant as specified in its charter)


Nevada		80-0433114
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)


2200 NW Corporate Blvd, Suite 220
Boca Raton, FL 33431		(561) 210-5349
(Address of Principal Executive Offices)		(Registrant's telephone number)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to section 12(g) of the Act: Common Stock, $0.0001 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.

Yes [ ] No [X]

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 (§ 229.405 of this chapter) during the proceeding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [X] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting registrant.

(Check one):


Large accelerated filer [ ]		Accelerated filer [ ]
Non-accelerated filer [ ]		Smaller reporting company [x]

Indicate by check mark whether the registrant is a shell registrant (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [X]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed fiscal quarter. The market value of the registrant’s voting $.0001 par value common stock held by non-affiliates of the registrant was approximately $3,026,544.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. The number of shares outstanding of the registrant’s only class of common stock, as of April 14, 2014 was 86,412,764 shares of its $0.0001 par value common stock.

DOCUMENTS INCORPORATED BY REFERENCE

None.

PMX Communities, Inc.

Form 10-K

For the Fiscal Year Ended December 31, 2013

Table of Contents


		Page
PART I
Item 1. Business		5
Item 1A. Risk Factors		8
Item 2. Properties		8
Item 3. Legal Proceedings		9
Item 4. Mine Safety Disclosures		9

PART II
Item 5. Market for Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities		10
Item 6. Selected Financial Data		12
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations		12
Item 7A. Quantitative and Qualitative Disclosures about Market Risk		15
Item 8. Financial Statements and Supplementary Data		16
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosures		36
Item 9A. Controls and Procedures		36
Item 9B. Other Information		38

PART III
Item 10. Directors, Executive Officers and Corporate Governance		39
Item 11. Executive Compensation		41
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		41
Item 13. Certain Relationships and Related Transactions, and Director Independence		42
Item 14. Principal Accountant Fees and Services		43

PART IV
Item 15. Exhibits, Financial Statement Schedules		45
Signatures		47

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

Certain statements in this report contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to implement our business plan and generate revenues, economic, political and market conditions and fluctuations, government and industry regulation, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Readers should carefully review this in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.

PART I

Item 1: Business

General

The registrant was organized under the laws of the State of Nevada on December 29, 2004 under the name Merge II, Inc. The registrant's year end is December 31.

On February 10, 2009, by unanimous written consent, the board of directors authorized an amendment to its certificate of incorporation to change the name of the corporation to PMX Communities, Inc. and increased the authorized common shares from 25,000,000 to 100,000,000. The amendment was filed on June 30, 2009.

On September 28, 2010, the registrant formed PMX Gold, LLC, a Florida limited liability company as a wholly owned subsidiary of the registrant to assist with evaluating and pursuing opportunities within the gold mining and retail gold sales industries.

On September 28, 2011, the registrant formed PMX Gold Bullion Sales, Inc., a Florida limited liability company as a wholly owned subsidiary of the registrant to manage and operate the manufacturing, supply and commercial distribution of proprietary fine gold products via its gold dispensing terminals.

Operations

Through PMX Gold, LLC, its wholly owned subsidiary, the registrant focuses on the development of leveraged opportunities within the retail gold sales and gold mining industries.

During the period from December 17, 2010 through March 23, 2011, the registrant test marketed and operated the first gold bullion vending machine at the Town Center at Boca Raton, a retail shopping mall located in South Florida. As of March 23, 2011 the registrant consummated a total of 699 gold transactions yielding gross sales of $266,256 through the Gold Vending Machine. Approximately 32% of the total sales were in the larger investment class denominations (10 grams to 1 ounce).

Although our tests were limited to one physical location, management is satisfied with the results of the test marketing program given the fact that the machine was operational in a cash only mode, together with a number of other significant technology and operational challenges that were faced. We have acquired full ownership of intellectual property including two U.S. Provisional Patent Applications and the third and final International Patent Application Number PCT/US2012/020486 (“Unattended Precious Metal Distribution System, Methods and Apparatus”), and are awaiting completion of a proprietary machine to re-commence automated gold bullion sales.

Through PMX Gold, LLC and PMX Gold Bullion Sales, Inc., the registrant focuses on the development and manufacture of its gold dispensing terminals, in addition to the manufacture, supply and commercial distribution, through said terminals, of its proprietary fine gold products.

Nationwide Expansion

PMX Gold Bullion Sales, Inc. has manufactured their first ATM gold terminal, called the MGIV. Newer versions of the PMX terminal will become more advanced as the demand for our products increases.

The registrant intends to sell gold bullion bars and coins through its dispensing terminals in the United States first. Later plans are to sell globally, doing business primarily through credit and debit card transactions. The registrant also plans to build an online gold bullion store.

The registrant is actively seeking gold properties and claims for development, including mineral lease purchase option transactions and reviewing several precious metal mining properties for development. We will consider a wide range of worldwide project opportunities, and we do not have fixed criteria for the consideration of such projects.

Assignment and Lease Assumption

The registrant is actively seeking mineral lease-purchase option transactions for speculation and reviewing several precious metals mining properties for development.

Government Regulation

We are subject to general business regulations and laws, as well as regulations and laws directly applicable to our operations. As we continue to expand the scope of our operations, the application of existing laws and regulations to the registrant relating to issues such as defamation, pricing, advertising, consumer protection, content regulation, quality of products and services and intellectual property ownership and infringement can be unclear. In addition, we will also be subject to new laws and regulations directly applicable to our activities.

Any existing or new legislation applicable to us could expose us to substantial liability, including significant expenses necessary to comply with such laws and regulations, and dampen the growth of our business.

Competition

We compete with many other sellers of precious metals products and entities that offer precious metals based financial products. As we expand the scope of our product offering, we will compete directly with a greater number of precious metals sales and investment companies including:

coin shops and other fixed retail locations that offer access to the general public for purchase of gold bullion products from fixed locations through face-to-face sales.

Internet based businesses that offer coin and bullion products for purchase electronically over the internet.

financial institutions that offer access to gold and precious metals, gold and precious metals based securities and other leveraged products to investors.

vertical markets where competitors may have advantages in expertise, brand recognition, available financial and other resources, and other factors.

Some of these competitors have established customer bases and market recognition. These competitors maintain billing relationships with more customers and have access to established distribution networks. We have not yet generated significant revenue nor established a significant client and customer base from our limited operations compared to some of these competitors.

If these or other competitors seize our product ideas and business model and produced competing versions of our PMX Gold Bullion Financial Management Account with similar product matrixes, our ability to generate revenue would be negatively affected.

Additionally, these new competitors could be better capitalized and capture a larger market share of our intended market.

Insurance

During the test marketing of the gold vending machine in 2011, the registrant maintained an insurance policy on the gold inventory, premises, and certain aspects of our business operations, as well as covering general liability of the registrant subject to certain limitations and exclusions. The registrant has signed a new insurance policy in December 2012 that covers both their office premises and any new gold machines.

Employees

We employ part-time employees on an as needed basis. We also have various consultants, lawyers and others that work for us on different aspects of our operations. As operations increase and revenues allow, we will have to employ an additional undetermined number of employees, consultants and contracted professionals to assist with the development of the registrant’s business plan.

Consulting Agreements

Gold Deposit Technologies, Inc.

On August 5, 2011, the registrant entered into an agreement with Gold Deposit Technologies, Inc. to assist in the development and implementation of the registrant's proprietary PMX Gold ATM Terminal and associated gold bullion based business plan.

The agreement allowed for annual stock awards and monthly cash payments to GDT in exchange for exclusive worldwide licensing rights to be awarded to the registrant for any technology and intellectual property developed between the parties as it relates to the precious metals industry, subject to certain financial and performance milestones to be accomplished by the registrant.

On March 15, 2012, the parties amended their agreement to allow for the assignment to and sole ownership by the registrant of all intellectual property rights developed to date, including but not limited to two earlier U.S. Provisional Patent Applications and a third patent filing (International Business Method Patent Application Number PCT/US2012/020486 'Unattended Precious Metal Distribution System, Methods and Apparatus').

GDT and the registrant recognized total payment to date under their contract of 3,000,000 PMXO shares and approximately $27,000 in cash as full and final payment due to GDT.

Saul Caprio

On October 5, 2011, the registrant entered into a consulting agreement with Saul Caprio to act as a technical advisor and a consultant.

The registrant paid 500,000 common shares to Saul Caprio for a term commencing June 20, 2011 through December 20, 2011. The registrant terminated this agreement in April 2012.

Item 1A. Risk Factors

Not applicable to a smaller reporting registrant.

Item 2. Properties

The registrant signed a lease agreement with Reflections of Boca, LLC on February 22, 2012 for a period of three years for a total cost of at a cost of $67,431.84. The office space is located at 2200 NW Corporate Boulevard, Suite 220, Boca Raton, FL

The registrant signed a lease with Town Center at Boca Raton in December 2012. The space is located at 6000 Glades Road, Boca Raton, FL 33431 at a cost of $3,500 per month. The lease agreement is for a term of one year, and expired in December 2013. The lease was not renewed in 2014. This lease is for the gold machine itself, and is not related to any further office space.

Item 3. Legal Proceedings

The registrant is not a party to, and its property is not the subject of, any material pending legal proceedings.

Item 4. Mine Safety Disclosures

Not applicable

PART II

Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities

Item 5(a)

a) Market Information. The Company began trading publicly on the OTCQB on December 15, 2010 under the symbol "PMXO.OB".

The following table sets forth the range of high and low bid quotations for our common stock. The quotations represent inter-dealer prices without retail markup, markdown or commission, and may not necessarily represent actual transactions.


2013	High	Low
January 1, 2013 - March 31, 2013	$0.10	$0.04
April 1, 2013 - June 30, 2013	$0.08	$0.02
July 1, 2013 - September 30, 2013	$0.07	$0.01
October 1, 2013 - December 31, 2013	$0.02	$0.00

2012
January 1, 2012 - March 31, 2012	$0.21	$0.05
April 1, 2012 - June 30, 2012	$0.08	$0.04
July 1, 2012 - September 30, 2012	$0.27	$0.05
October 1, 2012 - December 31, 2012	$0.15	$0.05

b) Holders. At April 14, 2014, there were approximately 100 shareholders of the registrant.

c) Dividends. Holders of our common stock are entitled to receive such dividends as may be declared by our board of directors. No dividends on our common stock have ever been paid, and we do not anticipate that dividends will be paid on our common stock in the foreseeable future.

d) Securities authorized for issuance under equity compensation plans.

On August 29, 2011, the registrant approved the 2011 Stock Awards Plan that authorizes the issuance of 6,000,000 common shares. This plan was amended on November 7, 2013 to increase the amount authorized for issuance under the plan to 10,000,000 common shares. The 2011 Stock Awards Plan Awards may be granted only to persons who, at the time of grant, are employees, consultants, members of the board or persons affiliated with the registrant or any of its affiliates. An award may be granted on more than one

occasion to the same person, and, subject to the limitations set forth in the Plan, such award may include an incentive stock option or a nonqualified stock option, a stock appreciation right, a restricted stock award, a phantom stock award or any combination thereof. To date, 7,000,000 common shares have been issued under the Plan.

The Plan shall remain in effect until all awards granted under the Plan have been satisfied or expired.

e) Performance graph. Not applicable.

f) Sale of unregistered securities.

In 2012, the registrant placed a total of $26,000 worth of units to 3 investors under SEC Rule 4(2) and issued 325,000 common shares and 325,000 “A” warrants and 325,000 “B” warrants.

In 2012, the registrant issued 4,000,000 shares of common stock for cash of $320,000 to investors at $0.08 per share.

In 2012, the registrant issued 1,000,000 shares for services to a consultant with a fair value of $60,000.

In 2013, the Company issued 1,075,000 shares of common stock for cash of $86,000.

In 2013, the Company issued 4,000,000 shares for services to 5 professionals with a fair value of $99,200.

During each of the years ended December 31, 2013 and 2012, the Company recorded an in-kind contribution of $25,000 for the value of the services provided by the CEO.

All of the above securities were issued pursuant to an exemption from registration under Section 4(2) of the Securities Act of 1933 to sophisticated investors.

Not applicable

Item 5(b) Use of Proceeds. Not applicable.

Item 5(c) Purchases of Equity Securities by the issuer and affiliated purchasers.

During 2013 and 2012 we repurchased no shares of our common stock.

Item 6. Selected Financial Data.

Not applicable to smaller reporting companies.

Item 7. Management’s Discussions and Analysis of Financial Condition and Results of Operations.

Trends and Uncertainties

The registrant has developed its PMX Gold Bullion Dispensing Terminal prototype called the MGIV and deployed the first prototype in Boca Raton, Florida, U.S.A. The terminal is an unmanned dispenser, which allows for gold dispensing and deposit and account management functions. These terminals also incorporate conventional ATM and touch-screen technology. After a successful 6 months test, the MGIV was removed in July 2013 from the first location.

The registrant has been assigned the ownership rights to two U.S. Provisional Patent Applications and a final International Patent Application Number PCT/US2012/020486 (“Unattended Precious Metal Distribution System, Methods and Apparatus”), and has filed next stage patent applications for its proprietary precious metals machine, in Australia, South Africa and the United States of America.

Our business operations are currently focused in three areas. The first original focus was the consumer demand for essentially one commodity gold through a dispensing terminal. Specifically, we were addressing the markets of physical gold ownership by retail investors, as well as developing and offering an ancillary set of financial services that would complement the purchase and sale of gold and other precious metals by retail investors. Any decrease in demand for gold or gold investments could still materially adversely affect our revenues in this area and profitability and general business prospects.

Presently, we are developing a second revenue stream. Our online PMX Goldstore, which sells 24k bullion gold bars and coins, launched in August. We are planning on initiating a third business operation which will involve the sales of our dispensing terminals globally through direct sales and distributor channels.

Results of Operations for the twelve months ended December 31, 2013 and 2012

For the year ended December 31, 2013, the registrant reported net sales of $76,874. The cost of sales was $75,682, resulting in gross profit of $1,193. We had depreciation expenses of $30,759 and selling, general and administrative expenses of $315,813. We had a loss on settlement of debt of $413, a loss on the writedown of inventory to market of $65,076, and interest expenses of $30,145. We earned other income of $500. As a result, we had a net loss of $440,513 for the year ended December 31, 2013.

Comparatively, for the year ended December 31, 2012, the registrant did not report any revenues. We had depreciation expenses of $12,810 a loss on the impairment of machinery of $54,342, and selling, general and administrative expenses of $278,233. We had gains on settlement of debt of $10,155 and interest expenses of $30,690. As a result, we had a net loss of $365,920 for the year ended December 31, 2012.

The $74,593 difference in net loss between the year ended December 31, 2013 and 2012 was primarily the result of our increased loss due to the writedown of inventory to market during the same year.

During the year ended December 31, 2013, our net loss was $440,513. We had the following adjustments to reconcile net loss to net cash provided by operating activities: $30,759 provided by depreciation, $99,200 provided by the issuance of common stock for services, $65,076 provided by a loss on inventory writedown, $413 provided by the loss on conversion of convertible notes, and $25,000 provided by in-kind services. We also had $74,622 from changes in inventory, $7,541 from changes in accounts payable, and $29,144 from changes in accrued interest. We also lost $2,033 from changes in accrued expenses. As a result, we had net cash used in operating activities of $110,791 for the year ended December 31, 2013.

During the year ended December 31, 2012, our net loss was $365,920. We had the following adjustments to reconcile net loss to net cash provided by operating activities: $12,810 provided by depreciation, $60,000 provided by issuance of common stock for services, and $54,342 provided by the loss on impairment of machine. We also had $8,410 provided from our loss on conversion of convertible notes, $7,292 provided by the amortization of note payable discount, and $25,000 provided by in-kind services. We also had a $161,563 loss from changes in inventory, a $5,000 loss from changes in security deposits, and $10,250 loss from changes in accrued expenses. We had a $413 increase due to changes in prepaid expenses and other current assets, a $10,036 increase due to changes in accounts payable, and a $23,411 increase due to changes in accrued interest. As a result, we had net cash used in operating activities of $341,019 for the year ended December 31, 2012.

Liquidity and Capital Resources

For the year ended December 31, 2013, we spent $43,724 on the purchase of fixed assets, resulting in net cash used in investing activities of $43,724 for the period.

For the year ended December 31, 2012, we spent $114,370 on the purchase of fixed assets, resulting in net cash used in investing activities of $114,370 for the period.

For the year ended December 31, 2013, we received $54,500 in proceeds from related party notes payable and $86,000 as proceeds from stock issuance, resulting in net cash provided by financing activities of $140,500 for the period.

For the year ended December 31, 2012, we received $52,367 in proceeds from notes payable, $112,100 from proceeds from related party notes payable, and $346,000 from proceeds from stock issuance. We spent $2,500 on payments on a short-term loan for a related party, $36,916 on repayment of notes payable, and $2,500 on payments made to stockholders. As a result, we had net cash provided by financing activities of $468,551 for the year ended December 31, 2012.

Our internal and external sources of liquidity have included proceeds raised from subscription agreements and private placements and advances from related parties. We are currently not aware of any trends that are reasonably likely to have a material impact on our liquidity. We are attempting to increase the sales to raise much needed cash for the fulfillment of the registrant’s business plan. It is our intent to secure a market share in the retail gold and related financial services market which we feel will require additional capital over the long term to undertake sales and marketing initiatives, further our research and development, and to manage timing differences in cash flows from the time our PMX Gold Bullion Account becomes active and the PMX Gold ATM terminals are developed and put into use and positive cash flow product is generated.

Our capital strategy is to increase our near and mid term cash balance through financing transactions, including the issuance of debt and/or equity securities. Once our PMX Gold ATM terminal prototypes have been developed and put into the field we intend to work to develop a pro-forma financial model based on their results and pursue traditional Wall Street financing.

Off-Balance Sheet Arrangements

The registrant had no material off-balance sheet arrangements as of December 31, 2013.

Critical Accounting Policies and Estimates Management's discussion and analysis of its financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles.

The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to the reported amounts of revenues and expenses and the valuation of our assets and contingencies. We believe our estimates and assumptions to be reasonable under the circumstances. However, actual results could differ from those estimates under different assumptions or conditions. Our financial statements are based on the assumption that we will continue as a going concern. If we are unable to continue as a going concern we would experience additional losses from the write-down of assets.

The registrant uses the fair value recognition provision of ASC 718, “Compensation-Stock Compensation,” which requires the Registrant to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments. The registrant uses the Black-Scholes option pricing model to calculate the fair value of any equity instruments on the grant date.

The registrant also uses the provisions of ASC 505-50, “Equity Based Payments to Non-Employees,” to account for stock-based compensation awards issued to non-employees for services. Such awards for services are recorded at either the fair value of the services rendered or the instruments issued in exchange for such services, whichever is more readily determinable, using the measurement date guidelines enumerated in ASC 505-50.

New Accounting Pronouncements

The registrant has adopted all recently issued accounting pronouncements. The adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the registrant.

Item 7a. Quantitative And Qualitative Disclosures About Market Risk

Not applicable.

Item 8. Financial Statements And Supplementary Data

PMX Communities, Inc.

Index to

Financial Statements



		Page
Report of Independent Registered Public Accounting Firm		17
Report of Independent Registered Public Accounting Firm		18

Audited Consolidated Balance Sheets of December 31, 2013 and 2012		19

Audited Consolidated Statements of Operations for the Years ended December 31, 2013 and 2012		20

Audited Consolidated Statement of Changes in Stockholders' Deficit		21

Audited Consolidated Statements of Cash Flows for the Years ended December 31, 2013 and 2012		22

Notes to Consolidated Financial Statements		24

[pmx10k13v5002.gif]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors of:

PMX Communities, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheet of PMX Communities, Inc. and Subsidiaries (the “Company”) as of December 31, 2012, and the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly in all material respects, the financial position of PMX Communities, Inc. and Subsidiaries as of December 31, 2012 and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 11 to the consolidated financial statements, the Company has a net loss of $365,920, a negative cash flow from operations of $341,019, a working capital deficiency of $208,694 and a stockholders' deficiency of $88,046. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans concerning these matters are also described in Note 11. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/Liggett, Vogt, & Webb P.A.

LIGGETT, VOGT & WEBB P.A.

Certified Public Accountants

Boynton Beach, Florida

April 12, 2013

Messineo & Co., CPAs LLC

2471 N McMullen Booth Rd, Ste. 302

Clearwater, FL 33759-1362

T: (727) 421-6268

F: (727) 674-0511

[pmx10k13v5004.gif]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of PMX Communities, Inc.

We have audited the accompanying consolidated balance sheets of PMX Communities, Inc. and Subsidiaries (‘the Company”) as of December 31, 2013 and the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for the year then ended. PMX Communities Inc.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of PMX Communities, Inc. and Subsidiaries of December 31, 2013, and the results of its operations and its cash flows for the year ended December 31, 2013 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 11, the Company has a deficiency in working capital, negative cash flows from operating activities, and a history of losses resulting in an accumulated deficit. The Company’s viability is dependent upon its ability to obtain future financing and the success of its future operations. These factors raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Messineo & Co., CPAs, LLC

Clearwater, FL

April 7, 2014

PMX Communities, Inc. and Subsidiaries

Consolidated Balance Sheets

As of December 31, 2013 and 2012


	December 31,	December 31,
	2013	2012
Assets

Current assets
Cash and cash equivalents	$ 2,956	$ 16,971
Inventory	25,050	164,748
Prepaid expenses	500	500
Other current assets	500	500
Total current assets	29,006	182,719

Fixed assets
Property and equipment , net	128,175	115,210

Other assets
Security deposits	5,438	5,438

Total assets	$ 162,619	$ 303,367

Liabilities and Stockholders' Deficit

Current liabilities
Accounts Payable	$ 58,295	$ 50,753
Accrued expenses	10,612	12,647
Related parties - short-term loan	194,828	131,331
Notes payable - short term	196,682	191,682
Total current liabilities	460,417	391,413

Notes payable - long term	-	-
Total Liabilities	460,417	391,413
Commitments and Contingency (See Note 9)
Stockholders' deficit
Common stock, $.0001 par value; authorized 100,000,000
shares; issued and outstanding 81,912,764 and 75,707,288 shares as of December 31,2013 and December 31, 2012	8,191	7,571
Additional paid-in capital	2,522,697	2,300,427
Accumulated deficit	(2,836,557)	(2,396,044)
Total stockholders' deficit	(305,669)	(88,046)
Total liabilities and stockholders' deficit	$ 162,619	$ 303,367

See accompanying notes to financial statements

PMX Communities, Inc. and Subsidiaries

Consolidated Statement of Operations

For the Years Ended December 31, 2013 and 2012


	For the Years Ended December 31,
	2013	2012

Net sales	$ 76,874	$ -
Cost of sales	75,681	-
Gross profit	1,193	-

Costs and expenses:
Depreciation	30,759	12,810
Loss on impairment of machine	-	54,342
Selling, general and administrative expenses	315,813	278,233
	346,572	345,385
Loss from operations	(345,379)	(345,385)

Gain/(loss) on settlement of debt	(413)	10,155
Loss on writedown of inventory to market	(65,076)	-
Other income	500	-
Interest expense	(30,145)	(30,690)
Loss before income taxes	(440,513)	(365,920)
Income taxes	-	-
Net loss	$ (440,513)	$ (365,920)

Basic net loss per share	$ (0.01)	$ (0.01)

Weighted average shares outstanding
Basic	77,962,049	71,192,503

See accompanying notes to financial statements.

PMX Communities, Inc. and Subsidiaries

Consolidated Statements of Changes in Stockholders' Deficit

For the Years Ended December 31, 2013 and 2012


			Additional Paid in Capital		Total Stockholders' Deficit
	Common Stock
				Accumulated
	Shares	Par Value		Deficit
Balance December 31, 2011	69,931,053	$6,993	$1,842,337	$(2,030,124)	$(180,794)

Common stock purchased for cash	4,000,000	400	319,600		320,000
Common stock units for cash	325,000	33	25,967		26,000
Stock issued for services	1,000,000	100	59,900		60,000
In-kind services			25,000		25,000
Conversion of notes payable into common stock	451,235	45	27,623		27,668
Net loss - for the year ended December 31, 2012				(365,920)	(365,920)


Balance December 31, 2012	75,707,288	$7,571	$2,300,427	$(2,396,044)	$(88,046)

Common stock purchased for cash	1,075,000	107	85,893		86,000
Common stock issued for services	4,000,000	400	98,800		99,200
In-kind services			25,000		25,000
Common stock issued in exchange of notes payable and accrued interest	1,130,476	113	12,577		12,690
Net loss - for the year ended December 31, 2013				(440,513)	(440,513)

	81,912,764	$8,191	$2,522,697	$(2,836,557)	$(305,669)

See accompanying notes to financial statements.

PMX Communities, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

For the Years Ended December 31, 2013 and 2012


	For the Years ended
	December 31,
	2013	2012
Cash flows from operating activities
Net loss	$ (440,513)	$ (365,920)
Adjustments to reconcile net (loss) to net
cash used in operating activities:
Depreciation	30,759	12,810
Issuance of common stock for services	99,200	60,000
Loss on impairment of machine	-	54,342
Loss on inventory writedown	65,076	-
Loss on conversion of convertible notes	413	8,410
Amortization of note payable discount	-	7,292
In-kind services	25,000	25,000
Change in assets and liabilities
Inventory	74,622	(161,563)
Prepaid expenses and other current assets	-	413
Security deposit	-	(5,000)
Accounts payable	7,541	10,036
Accrued interest	29,144	23,411
Accrued expenses	(2,033)	(10,250)
Net cash used in operating activities	(110,791)	(341,019)

Cash flows from investing activities
Purchase of fixed assets	(43,724)	(114,370)
Net cash used in investing activities	(43,724)	(114,370)

Cash flows from financing activities
Proceeds from notes payable	-	52,367
Proceeds from related party notes payable	54,500	112,100
Payments on related party - short-term loan	-	(2,500)
Repayment of notes payable	-	(36,916)
Payment made to stockholder	-	(2,500)
Proceeds from stock issuance	86,000	346,000

Net cash provided by financing activities	140,500	468,551

Net increase/(decrease) in cash and cash equivalents	(14,015)	13,162
Cash and cash equivalents, beginning of fiscal year	16,971	3,809
Cash and cash equivalents, end of period	$ 2,956	$ 16,971

PMX Communities, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

For the Years Ended December 31, 2013 and 2012

(Continued from previous page)


Supplementary information:
Cash paid for :
Interest	$ 492	$ 396
Income taxes	$ -	$ -

Non-cash transactions:
Common stock issued for services	$ 99,200	$ 60,000
Conversion of Notes Payable and accrued expense into common stock	$ 12,690	$ 27,668

See accompanying notes to financial statements.

PMX Communities, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

For the Years Ended December 31, 2013 and December 31, 2012

NOTE 1 - DESCRIPTION OF BUSINESS

PMX Communities, Inc. "PMX" was organized under the laws of the State of Nevada on December 29, 2004 under the name Merge II, Inc. PMX's year end is December 31.

On September 28, 2010, the Company formed PMX Gold, LLC, (“PMX Gold”) a Florida limited liability company as a wholly owned subsidiary of the Company to assist with evaluating and pursuing opportunities within the Gold Mining and Retail Gold Sales Industries.

On September 28, 2011, the Company formed PMX Gold Bullion Sales Inc. (“PMX Bullion”), a Florida corporation as a wholly owned subsidiary of the Company.

PMX, (through its wholly owned subsidiaries PMX Gold, LLC and PMX Gold Bullion Sales Inc.) focuses on the development of leveraged opportunities within the Retail Gold Sales and Gold Mining Industries.

PMX Communities, Inc and its wholly- owned subsidiaries are hereafter referred to as “the Company”.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements and notes are prepared in accordance with accounting principles generally accepted in the United States of America.

A summary of the significant accounting policies consistently applied in the preparation of the accompanying financial statements is as follows:

The accompanying consolidated financial statements were prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of operations.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Significant estimates include the valuation of inventories, deferred tax assets and equity transactions.

Principles of Consolidation

The consolidated financial statements include the accounts of PMX Communities, Inc. and its wholly-owned subsidiaries, PMX Gold, LLC and PMX Gold Bullion Sales, Inc. All significant inter-company transactions have been eliminated.

Financial Instruments and Fair Value

The Company’s balance sheet includes certain financial instruments, including cash, inventory, accounts payable, accrued expenses and notes payable. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1

Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities

Level 2

Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3

Inputs that are both significant to the fair value measurement and unobservable.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2013. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

Inventories

Inventories are valued at the lower of cost (first-in, first-out) or market, and include finished gold bullion coins and bars. Inventory is stated at fair market value in accordance with ASC 330-10-35-15.

Equipment

Equipment is stated at cost, less accumulated depreciation. Depreciation is provided using the straight line method over the estimated useful life of five years for equipment, seven years for molds and seven years for furniture and fixtures.

Impairment of Long-Lived Assets

The Company evaluates the recoverability of long-lived assets and the related estimated remaining useful lives when events or circumstances lead management to believe that the carrying value of an asset may not be recoverable and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amounts. In such circumstances, those assets are written down to estimated fair value. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset's estimated fair value and its book value. During 2012, the Company recognized an impairment loss of $54,342.

Common Stock, Common Stock Options and Warrants

The Company uses the fair value recognition provision of ASC 718, "Compensation-Stock Compensation," which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments. The Company uses the Black-Scholes option pricing model to calculate the fair value of any equity instruments on the grant date.

The Company also uses the provisions of ASC 505-50, "Equity Based Payments to Non-Employees," to account for stock-based compensation awards issued to non-employees for services. Such awards for services are recorded at either the fair value of the services rendered or the instruments issued in exchange for such services, whichever is more readily determinable, using the measurement date guidelines enumerated in ASC 505-50.

Income Taxes

Under the asset and liability method prescribed under ASC 740, Income Taxes, the Company uses the liability method of accounting for income taxes. The liability method measures deferred income taxes by applying enacted statutory rates in effect at the balance sheet date to the differences between the tax basis of assets and liabilities and their reported amounts on the financial statements. The resulting deferred tax assets or liabilities are adjusted to reflect changes in tax laws as they occur. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized.

The Company recognizes the financial statement benefit of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a "more-likely-than-not" threshold, the amount recognized in the financial statements is the benefit expected to be realized upon settlement with the tax authority. For tax positions not meeting the threshold, no financial statement benefit is recognized. As of December 31, 2013 and 2012, the Company had no uncertain tax positions. The Company recognizes interest and penalties, if any, related to uncertain tax positions as general and administrative expenses. The Company currently has no federal or state tax examinations nor has it had any federal or state examinations since its inception. The tax years for December 31, 2011-2013 remain subject to review by federal and state tax authorities.

Revenue Recognition

The Company recognizes revenue when it is realized and realizable.

- Persuasive evidence of an arrangement exists; and

- Delivery has occurred; and

- Price is fixed or determinable; and

- Collectability is reasonably assured

Subject to these criterions, the Company recognizes revenue at the time the merchandise is purchased and the machine dispenses the relevant merchandise. The Company offers its individual customers a 14-day warranty if the item is returned and if the TEP packaging is not broken. The customer will receive their money back. The Company estimates an allowance for sales returns based on historical experience with product returns. The Company closely follows the provisions of ASC 605, Revenue Recognition, which includes the guidelines of Staff Accounting Bulletin No. 104 as described above.

Income (loss) Per Common Share

Basic income (loss) per share is calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period. As of December 31, 2013 and 2012, the effect of 325,000 and 4,081,053 warrants, respectively, are not included in the loss per share calculation since the effect is anti-dilutive.

Reclassifications

Certain prior period balances have been reclassified to conform to the current year's presentation. These reclassifications had no impact on previously reported results of operations or stockholders' equity.

Recent Authoritative Accounting Pronouncements

In February 2013, FASB issued Accounting Standards Update 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date (a consensus of the FASB Emerging Issues Task Force). This guidance requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date. This stipulates that (1) it will include the amount the entity agreed to pay for the arrangement between them and the other entities that are also obligated to the liability and (2) any additional amount the entity expects to pay on behalf of the other entities. The objective of this update is to provide guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements. The amendments in this update are effective for fiscal periods (and interim reporting periods within those years) beginning after December 15, 2013. This standard is not expected to have a material impact on the Company’s reported results of operations or financial position.

In February 2013, FASB issued Accounting standards update 2013-02, Comprehensive Income Topic 220): Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income. This update requires an entity to provide information amount the amount reclassified out of accumulated other comprehensive income by component. The entity is also required to disclose significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting periods. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other discourses required under U.S. GAAP that provide additional detail

about those amounts. The objective in this Update is to improve the reporting of reclassifications out of accumulated other comprehensive income. The amendments in this update should be applied prospectively for reporting periods beginning after December 15, 2012. This standard is not expected to have a material impact on the Company’s reported results of operations or financial position.

NOTE 3 - INVENTORY

Included in inventory are the package materials used to hold each piece disbursed from the gold dispensing terminal.

Inventory consists of the following:


		December 31, 2013		December 31, 2012

Finished Goods	$	25,050	$	164,748
	$	25,050	$	164,748

The Company recognized a write-down to fair market value, attributable to the gold pricing, in the amount of $65,076.

NOTE 4 - PROPERTY AND EQUIPMENT

Components of property and equipment are as:


		December 31, 2013		December 31, 2012

Gold Machines	$	146,224	$	131,761
Molds		8,909		8.909
Office Equipment		1,600		1,600
Office Furniture and Fixtures		3,366		3,366
Less: Accumulated Depreciation		(31,924)		(30,426)

Property and Equipment, net	$	128,175	$	115,210

Depreciation for the years ended December 31, 2013 and 2012 was $30,759 and $12,810, respectively. During the year ended December 31, 2012, the Company recorded an impairment loss of $54,342 related to a gold machine.

NOTE 5 - ACCRUED EXPENSES

Accrued liabilities consisted of the following:


		December 31, 2013		December 31, 2012

Accrued Professional Fees	$	10,000	$	10,000
Payroll Taxes Payable		66		66
Sales Tax Payable		546		2,581

	$	10,612	$	12,647

NOTE 6 - NOTES PAYABLE

Convertible Notes

Beginning in 2009, the Company entered into various Convertible Promissory Notes at an annual interest rate of 8-10%. The Notes are unsecured and have staggered conversion features at 180, 360, 540 and 720 days after issuance and are convertible at a rate equal to 50% of the weighted average price in the 30 trading days preceding notice of conversion.

For the year ended 2012, a Note totaling $11,400 of principal and accrued interest of $3,849 was retired for cash resulting in a gain on retirement of notes of $1,745 that was reflected in the 2012 Statement of Operations. Additionally, Convertible Notes with a principal balance of $5,000 were converted to 70,610 shares of common stock at $0.08/share resulting in a gain on conversion of notes of $679.

The Convertible Notes carried outstanding principal of $40,000 and $25,000 as of December 31, 2013 and 2012, respectively. Accrued interest was $11,005 and $6,736 as of December 31, 2013 and December 31, 2012. The convertible features had expired on all outstanding Convertible Notes as of December 31, 2011.

Promissory Notes

Beginning in 2010, the Company entered into various Promissory Notes at an annual interest rate of 8-10%. The Notes are unsecured and have maturities ranging from 6 months to 2 years.

During the year ended December 31, 2012, one shareholder converted his Promissory Notes with a principal and accrued interest balance of $30,202 to 380,625 shares of common stock resulting in a gain of $7,731 that was recorded in the Statement of Operations.

During the year ended December 31, 2013, one related party converted his Promissory Note with a principal and accrued interest balance of $10,694 to 1,110,684 shares of common stock resulting in a loss of $413 that was recorded in the Statement of

Operations for the year ended December 31, 2013. Additionally, during the year ended December 31, 2013, 19,792 shares were awarded to one shareholder to satisfy accrued interest of $1,583 on a note previously converted in December 2012.

During the year ended December 31, 2013, one related party loaned the Company a total of $54,500 in a series of 9 promissory notes. The notes each have a 6-month maturity period with an annual interest rate of 5% and 10% after the maturity date.

The Promissory Notes carried outstanding principal of $299,967 and $298,013 as of December 31, 2013 and 2012, respectively. Accrued interest was $43,409 and $25,146 as of December 31, 2013 and December 31, 2012. Of these outstanding Promissory Notes, related parties held $164,823 and $85,561 in principal and accrued interest for the years ended December 31, 2013 and 2012, respectively.

Future maturities of notes payable are as follows:

Year ending December 31, 2013


Past Due	$364,770
2013	-
2014	34,611
2015	-
2016	-
Total	$399,381

NOTE 7 - EQUITY TRANSACTIONS

In 2012, the Company placed a total of $26,000 worth of units to 3 investors Under SEC Rule 4(2) and issued 325,000 common shares and 325,000 “A” Warrants and 325,000 “B” Warrants.

In 2012, the Company issued 4,000,000 shares of common stock for cash of $320,000 to investors at $0.08 per share.

In 2013, the Company issued 1,075,000 shares of common stock for cash of $86,000.

Shares Issued for Services

In 2012, the Company issued 1,000,000 shares for services to a consultant with a fair value of $60,000.

In 2013, the Company issued 4,000,000 shares for services to 5 professionals with a fair value of $99,200.

During each of the years ended December 31, 2013 and 2012, the Company recorded an in-kind contribution of $25,000 for the value of the services provided by the CEO.

Warrants

The following tables summarize all “A” and “B” warrants issued to consultants and warrants issued as part of convertible debt transactions for the year ended December 31, 2013 and December 31, 2012, and the related changes during these years. The A warrants are exercisable at $0.20 per share for a period of one year from the date of issue and the B warrants are exercisable at $0.25 per share for a period of two years from the date of issue.


Warrants
Balance at December 31, 2011		6,862,106
Issued		650,000
Exercised		0
Expired/Forfeited		(3,431,053)
Balance at December 31, 2012		4,081,053
Warrants Exercisable at December 31, 2012		4,081,053
Weighted Average Fair Value of Warrants Granted During 2012	$	0.0068


Balance at December 31, 2012		4,081,053
Issued		0
Exercised		0
Expired/Forfeited		(3,756,053)
Balance at December 31, 2013		325,000
Warrants Exercisable at December 31, 2013		325,000
Weighted Average Fair Value of Warrants Granted During 2013	$	-

NOTE 8 - RELATED PARTY TRANSACTIONS

In 2012, the Company’s majority shareholder loaned the Company $112,100 and was repaid $2,500 from a previous note. Additionally, the Company’s CEO loaned the Company $10,000.

In 2013, the Company’s majority shareholder loaned the Company $54,500. Amounts loaned were at various dates, evidenced by notes, maturing in six months, at stated interest rate of 5% and 10% after the maturity date

In 2013, an officer of the company converted a promissory note with principal and accrued interest of $10,694 to 1,110,684 shares of common stock.

NOTE 9 – COMMITMENT AND CONTIGENCY

In December 2012, the Company signed a 36-month lease agreement for office space at Reflections of Boca LLC. The rent is $1,366 per month.

The Company signed a 12-month lease for rental space for the Company’s gold dispensing terminal on January 1, 2013. The rent is $3,500 per month. The lease was not renewed for 2014.

Security Deposits consist of the following:


		December 31, 2013		December 31, 2012

West Boca Executive Suites	$	939	$	939
Reflections OF Boca LLC		4,499		4,499
	$	5,438	$	5,438

Future lease commitments


For the years ending:
2014	16,104
2015	2,928
Total	$19,032

NOTE 10 – PROVISION FOR INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax liabilities and assets as of December 31, 2013 and 2012 are as follows:


		2013		2012
At December 31, deferred tax assets consist of:
Net operating loss carry forward	$	2,368,326	$	1,927,813
Start-up costs capitalized for tax purposes		405,876		405,876
Gross deferred tax assets		970,971		816,791
Valuation allowance		(970,971)		(816,791)
Net deferred tax assets	$	-	$	-

The difference between income tax expense computed by applying the federal statutory corporate tax rate and actual income tax expense is as follows:


	December 31,
	2013	2012

Combined statutory income tax rate	35%	35%

Valuation allowance	(35%)	(35%)
Effective tax rate	-	-

Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The effects of temporary differences that gave rise to deferred tax assets are as follows:

The Company has made a 100% valuation allowance of the deferred income tax asset at December 31, 2013, as it is not expected that the deferred tax assets will be realized. The Company has a net operating loss carry forward of $2,368,326 available to offset future taxable income through 2033. The valuation allowance increased $154,180 for the year ended December 31, 2013.

The Company’s federal income tax returns for the years ended December 31, 2011 through December 31, 2013 remains subject to examination by the Internal Revenue Services as of December 31, 2013.

NOTE 11 - GOING CONCERN

As reflected in the accompanying consolidated financial statements, the Company had a net loss of $440,513 and $365,920 for the years ended December 31, 2013 and December 31, 2012, respectively. The Company has a working capital and stockholders' deficiency of $439,282 and $305,669, respectively at December 31, 2013. There is a substantial doubt about the ability of the Company to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to further implement its business plan and raise capital. Management hopes that the continued placement of precious metals machines in the U.S.A. and the potential of a global rollout of additional dispensing terminals will bring sufficient revenues and investment into the Company to sustain its growth and operations. Furthermore, the registrant feels organic growth through a new acquisition strategy in their other subsidiaries will assist the registrant in achievement of their goals. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 12 - SUBSEQUENT EVENTS

Equity Transactions

On January 6, 2014, the Company issued 2,000,000 shares of common stock to an officer for future services to be provided

On March 6, 2014, the Board of Directors of the Company approved the issuance of options to consultants to purchase 2,500,000 shares of common stock at a strike price of $0.03/share.

Item 9. Changes In And Disagreements With Accountants On Accounting And Financial Disclosure

None

Item 9a. Controls And Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of December 31, 2013. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Based on this evaluation, our chief executive officer and chief financial officer have concluded such controls and procedures to be not effective as of December 31, 2013 to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms and to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is the process designed by and under the supervision of our chief executive officer and chief financial officer, or the persons performing similar functions, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our financial statements for external reporting in accordance with accounting principles generally accepted in the United States of America. These officers have evaluated the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control over Financial Reporting – Guidance for Smaller Public Companies.

Our chief executive officer and chief financial officer have assessed the effectiveness of our internal control over financial reporting as of December 31, 2013 and concluded that it was not effective because of the material weakness described below:

In connection with the preparation of our consolidated financial statements for the year ended December 31, 2013, material weaknesses became evident to management regarding our inability to generate all the necessary disclosure for inclusion in our filings with the Securities and Exchange Commission due to the lack of resources and segregation of duties. A material weakness is a significant deficiency in one or more of the internal control components that alone or in the aggregate precludes our internal controls from reducing to an appropriately low level the risk that material misstatements in our consolidated financial statements will not be prevented or detected on a timely basis.

The registrant hired an outsource certified public accountant to work with our CFO and management on an as needed basis to eliminate the material weaknesses. We will continue to aggressively recruit experienced professionals to ensure that we include all necessary disclosures in our filings with the Securities and Exchange Commission. Although we believe that this corrective step will enable management to conclude that the internal controls over our financial reporting are effective when the staff is trained, we cannot assure you these steps will be sufficient. We may be required to expend additional resources to identify, assess and correct any additional weaknesses in internal control.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the registrant’s registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the registrant to provide only management’s report in this annual report.

Evaluation of Changes in Internal Control over Financial Reporting

Our chief executive officer and chief financial officer have evaluated changes in our internal controls over financial reporting that occurred during the year ended December 31, 2013. Based on that evaluation, our chief executive officer and chief financial officer, or those persons performing similar functions, did not identify any change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Important Considerations

The effectiveness of our disclosure controls and procedures and our internal control over financial reporting is subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness to future periods are subject to

the risk that controls may become inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time. Because of these limitations, there can be no assurance that any system of disclosure controls and procedures or internal control over financial reporting will be successful in preventing all errors or fraud or in making all material information known in a timely manner to the appropriate levels of management.

Item 9b. Other Information

None

PART III

Item 10. Directors, Executive Officers And Corporate Governance.

Our bylaws provide that the number of directors who shall constitute the whole board shall be such number as the board of directors shall at the time have designated. We confirm that the number of authorized directors has been set at one or more in number pursuant to our bylaws.

Each director shall be selected for a term of one year and until his successor is elected and qualified. Vacancies are filled by a majority vote of the remaining directors then in office with the successor elected for the unexpired term and until the successor is elected and qualified. The directors, officers and significant employees are as follows:


NAME	AGE	POSITIONS HELD	SINCE
Lindsey Perry	59	CEO/ Director/ CFO/ Controller	April 19, 2012 to present

Business Experience of Officers, Directors and Significant Employees

Lindsey R. Perry, Jr. has been the chairman, chief executive officer, and chief financial officer of PMX Communities since April 19, 2012. Mr. Perry graduated from Bucknell University in 1977 with a Bachelor of Science Degree in accounting.

The above named director will serve in his capacity as director until our next annual shareholder meeting to be held within six months of our fiscal year's close. Directors are elected for one-year terms.

Section 16(a) Beneficial Ownership Reporting Compliance

To our knowledge, no director, officer or beneficial owner of more than ten percent of any class of our equity securities, failed to file on a timely basis reports required by Section 16(a) of the Exchange Act during 2013.

Code of Ethics Policy

We have not yet adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions.

Corporate Governance

There have been no changes in any state law or other procedures by which security holders may recommend nominees to our board of directors. In addition to having no nominating committee for this purpose, we currently have no specific audit committee and no audit committee financial expert. Based on the fact that our current business affairs are simple, any such committees are excessive and beyond the scope of our business and needs.

Family Relationships

There are no family relationships between our officers and directors.

Involvement in Certain Legal Proceedings

None of our directors, executive officers and control persons has been involved in any of the following events during the past ten years:

Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time,

Any conviction in a criminal proceeding or being subject to any pending criminal proceeding (excluding traffic violations and other minor offenses);

Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his or her involvement in any type of business, securities or banking activities; or

Being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

Item 11. Executive Compensation

We may elect to award a cash bonus to key employees, directors, officers and consultants based on meeting individual and corporate planned objectives.


Name and Principal Position	Year	Salary	Bonus	Stock Awards	Option Awards	Non-Equity Incentive Plan Comp	Nonqualified deferred Comp Earnings	All Other Comp	Total
Lindsey Perry	2013	-	-	-	-	-	-	-	-
CEO/ CFO	2012	-	-	-	-	-	-	-	-

Michael C. Hiler	2013	-	-	-	-	-	-	-	-
Former CEO/ CFO	2012	-	-	-	-	-	-	-	-

Mervyn M. Gervis	2013	-	-	-	-	-	-	-	-
Former Director	2012	-	-	-	-	-	-	-	-

Michael W. McCauley	2013	-	-	-	-	-	-	-	-
Former VP	2012	-	-	-	-	-	-	-	-
Mark Connell	2013	-	-	-	-	-	-	-	-
Former President	2012	-	-	-	-	-	-	-	-


Alfred Cortellini	2013	-	-	-	-	-	-	-	-
Former Director	2012	-	-	-	-	-	-	-	-
Rick Seay	2013	-	-	-	-	-	-	-	-
Former Director	2012	-	-	-	-	-	-	-	-

Item 12. Securities Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth, as of April 14, 2014, the number and percentage of our outstanding shares of common stock owned by (i) each person known to us to beneficially own more than 5% of its outstanding common stock, (ii) each director, (iii) each named executive officer and significant employee, and (iv) all officers and directors as a group.

The number of shares listed below includes shares that each shareholder listed in the table has the right to acquire beneficial ownership of within 60 days.


Name and Address	Number & Class of Shares	Percentage of Outstanding Common Shares
Lindsey R. Perry, Jr. (1)	5,916,628 direct	6.85%
6505 NW 39^th Terrace	110,000 indirect(2)	0.13%
Boca Raton, FL 33496

Directors/ Officers	5,916,628 direct	6.85%
As a group one (1) person	110,000 indirect	0.13%


Mark Goldstein	1,620,975 direct	1.88%
2700 N. Military Trail	33,000,000 indirect (3)	38.19%
Suite 130
Boca Raton, FL 33431

(1)Mr. Perry is an officer and director of PMX Communities.

(2)These shares are owned by Caddyshack Partners, LLC. Mr. Perry owns 25% of this entity

(3)Represents common shares held by Dickinson Capital, LLC (a Florida limited liability company) that is controlled by Mark B. Goldstein.

Based upon 86,412,764 outstanding common shares as of April 14, 2014.

Item 13. Certain Relationships and Related Transactions, and Director Independence

In 2012, Mark Goldstein, the registrant’s majority shareholder loaned the registrant $112,100 and was repaid $2,500 from a previous note. Additionally, Lindsey Perry, the registrant’s CEO, loaned the registrant $10,000.

In 2013, Mark Goldstein loaned the registrant $54,500.

In 2013, Lindsey Perry converted a promissory note with principal and accrued interest of $10,694 to 1,110,684 common shares.

On January 6, 2014, the registrant issued 2,000,000 common shares to Lindsey Perry for future services.

Director Independence

All of our directors are independent as such term is defined by a national securities exchange or an inter-dealer quotation system. During the years ended December 31, 2013 and 2012 there were no transactions with related persons other than as described in the section below.

Item 14. Principal Accounting Fees and Services

On May 1, 2013, the registrant dismissed Liggett, Vogt & Webb, P.A. as their registered independent public accountant. On May 2, 2013, the registrant engaged Messineo & Co., CPAs as their new independent public accountant. The following table shows the fees that were billed for the audit and other services provided by such firm for 2013.


		2013
Audit Fees		$12,500
Audit-Related Fees		-
Tax Fees		-
All Other Fees		-
Total		$12,500

Liggett, Vogt & Webb, P.A. served as our independent registered public accounting firm from February 15, 2013 through May 1, 2013, and performed the audit for the year ended December 31, 2012. The following table shows the fees that were billed for the audit and other services provided by such firm for 2013.


		2012
Audit Fees		$15,000
Audit-Related Fees		-
Tax Fees		-
All Other Fees		-
Total		$15,000

Lake and Associates CPA's, LLC served as our independent registered public accounting firm for 2012. The following table shows the fees that were billed for the audit and other services provided by such firm for 2012.


		2012
Audit Fees		$14,000
Audit-Related Fees		-
Tax Fees		-
All Other Fees		-
Total		$14,000

Audit Fees - This category includes the audit of our annual financial statements, review of financial statements included in our Form 10-Q Quarterly Reports and services that are normally provided by the independent auditors in connection with engagements for those fiscal years. This category also includes advice on audit and accounting matters that arose during, or as a result of, the audit or the review of interim financial statements.

Audit-Related Fees - This category consists of assurance and related services by the independent auditors that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under "Audit Fees." The services for the fees disclosed under this category include consultation regarding our correspondence with the SEC and other accounting consulting.

Tax Fees - This category consists of professional services rendered by our independent auditors for tax compliance and tax advice. The services for the fees disclosed under this category include tax return preparation and technical tax advice.

Pre-approval Policy

Our Board of Directors has adopted a procedure for pre-approval of all fees charged by our independent auditors. Under the procedure, the Board approves the engagement letter with respect to audit, tax and review services. Other fees are subject to pre-approval by the Board, or, in the period between meetings, by a designated member of Board. Any such approval by the designated member is disclosed to the entire Board at the next meeting. The audit and tax fees paid to the auditors with respect to 2013 were pre-approved by the entire Board of Directors.

Board of Directors Report

The Board of Directors has reviewed and discussed with the registrant's management and independent auditor the audited consolidated financial statements of the registrant’s contained in the registrant's Annual Report on Form 10-K for the registrant's fiscal year ended December 31, 2013. The Board has also discussed with the independent auditor the matters required to be discussed pursuant to SAS No. 61 (Codification of Statements on Auditing Standards, AU Section 380), which includes, among other items, matters related to the conduct of the audit of the registrant's consolidated financial statements.

The Board has received and reviewed the written disclosures and the letter from the independent auditor required by the applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor's communications with the Board concerning independence, and has discussed with its independent auditor its independence from the registrant.

The Board has considered whether the provision of services other than audit services is compatible with maintaining auditor independence.

Based on the review and discussions referred to above, the Board approved the inclusion of the audited consolidated financial statements in the registrant's Annual Report on Form 10-K for its fiscal year ending December 31, 2013 for filing with the SEC.

PART IV

Item 15. Exhibits, Financial Statement Schedules

(a)(1) List of Financial statements included in Part II hereof

Balance Sheets, December 31, 2013 and 2012

Statements of Operations for the years ended December 31, 2013 and 2012

Statements of Stockholders' Equity (Deficit) for the years ended December 31, 2013 and 2012

Statements of Cash Flows for the years ended December 31, 2013 and 2012

Notes to the Financial Statements

(a)(2) List of Financial Statement schedules included in Part IV hereof: None.

(a)(3) Exhibits

The following exhibits are included herewith:


Exhibit No.	Description
31	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

*XBRL (Extensible Business Reporting Language) 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.

Following are a list of exhibits which we previously filed in other reports which we filed with the SEC, including the Exhibit No., description of the exhibit and the identity of the Report where the exhibit was filed.


NO.	DESCRIPTION	FILED WITH	DATE FILED
3.1	Articles of Incorporation	Form S-1	September 3, 2009
3.2	Certificate of Amendment	Form S-1	September 3, 2009
3.3	Certificate of Change	Form S-1	September 3, 2009
3.4	Bylaws	Form S-1	September 3, 2009
4.1	PMX Stock Awards Plan	Form S-8	November 11, 2013
10.1	Lease-Purchase Option	Form S-1	September 3, 2009
10.2	Revised Assignment and Assumption	Form S-1/A	October 16, 2009
10.3	Agreement with Invisosoft	Form S-1	September 3, 2009
10.4	Business Consultant Agreement	Form S-1	September 3, 2009
10.5	Gervis Agreement	Form S-1/A	October 16, 2009
10.6	Partial Satisfaction of Promissory Notes	Form S-1/A	October 16, 2009
10.7	Mark Goldstein Note Dated 2/13/09	Form S-1/A	October 16, 2009
10.8	Barry Roderman Note Dated 2/13/09	Form S-1/A	October 16, 2009
10.9	Mark Connell Note Dated 2/27/09	Form S-1/A	October 16, 2009
10.10	Andrew Goldstein Note Dated 3/8/09	Form S-1/A	October 16, 2009
10.11	Philip and Cynthia Liberty Note Dated 6/19/09	Form S-1/A	October 16, 2009
10.12	Glenn Murphy Note Dated 6/25/09	Form S-1/A	October 16, 2009
10.13	Financing Agreement Dated 8/18/10	Form 8-K	October 20, 2010
10.14	Agreement Dated 9/2/10	Form 8-K	October 20, 2010
10.15	Agreement Dated 10/5/10	Form 8-K	October 20, 2010
10.16	Transmedia Consulting Agreement	Form 8-K	December 20, 2010
10.17	Tritos Consulting Agreement	Form 8-K	December 20, 2010
10.18	Development Agreement	Form 8-K	August 29, 2011
10.19	Financing Agreement	Form 8-K	August 29, 2011
10.20	Employment Agreement	Form 8-K	August 29, 2011
10.21	2011 Stock Awards Plan	Form 8-K	August 29, 2011
10.22	First Amendment to Executive Employment Agreement	Form 8-K/A	February 15, 2012
10.23	Promissory Note	Form 8-K/A	February 15, 2012
16.1	Auditor's Letter	Form 8-K/A	February 22, 2013
99.1	Confidentiality Agreement	Form 8-K	May 21, 2012

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

PMX COMMUNITIES, INC.

BY: /s/ Lindsey Perry

Lindsey Perry

Chief Executive Officer, Chief Financial Officer

Dated: April 14, 2014

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ Lindsey Perry

Lindsey Perry

Chief Executive Officer, Chief Financial Officer, Director, Controller

Dated: April 14, 2014

PMX Communities, Inc. Reports

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