Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2014
Commission file number 000-54868
Free Flow Inc.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
2301 Woodland Crossing Dr.
Suite 155, Herndon, VA 20171
(Address of Principal Executive Offices)
(703) 789-3344
(Registrant's Telephone Number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 last 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 (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). YES [X] NO [
]
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,"
"non-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]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). YES [ ] NO [X]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 26,200,000 shares as of May 12, 2014.
ITEM 1. FINANCIAL STATEMENTS
Free Flow, Inc.
(A Development Stage Company)
Condensed Balance Sheets
--------------------------------------------------------------------------------
As of As of
March 31, December 31,
2014 2013
-------- --------
(Unadited)
CURRENT ASSETS
Cash $ 42 $ 237
-------- --------
42 237
TOTAL CURRENT ASSETS
FIXED ASSETS
Equipment, net 661 718
TOTAL FIXED ASSETS 661 718
-------- --------
OTHER ASSETS
Intangible Assets, net -- --
-------- --------
TOTAL OTHER ASSETS -- --
-------- --------
TOTAL ASSETS $ 703 $ 955
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 12,127 $ 2,940
Notes payable -related party 10,000 10,000
Accrued interest 617 617
-------- --------
TOTAL CURRENT LIABILITIES 22,744 13,557
LONG-TERM LIABILITIES
Accrued interest 357 117
Notes payable - non-related party 368
Notes payable -related party 15,100 12,468
-------- --------
TOTAL LONG-TERM LIABILITIES 15,825 12,585
TOTAL LIABILITIES 38,569 26,142
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred Stock ($0.0001 par value, 20,000,000 shares
authorized; zero shares issued and outstanding
as of March 31, 2014 and December 31, 2013 -- --
Common stock, ($0.0001 par value, 100,000,000 shares
authorized; 26,200,000 shares issued and outstanding
as of March 31, 2014 and December 31, 2013 2,620 2,620
Additional paid-in capital 18,380 18,380
Deficit accumulated during development stage (58,866) (46,187)
-------- --------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (37,866) (25,187)
-------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) $ 703 $ 955
======== ========
The accompanying notes are an integral part of these financial statements
2
Free Flow, Inc.
(A Development Stage Company)
Condensed Statements of Operations
(Unaudited)
--------------------------------------------------------------------------------
October 28, 2011
3 months 3 months (inception)
Ended Ended through
March 31, March 31, March 31,
2014 2013 2014
------------ ------------ ------------
REVENUES
Revenues $ -- $ -- $ --
------------ ------------ ------------
TOTAL REVENUES -- -- --
GENERAL & ADMINISTRATIVE EXPENSES
Administrative expenses 2,932 406 18,462
Professional fees 9,450 7,700 33,950
Depreciation Expense 57 57 480
Amortization Expense -- 5,000
------------ ------------ ------------
TOTAL GENERAL & ADMINISTRATIVE EXPENSES 12,439 8,163 57,892
------------ ------------ ------------
LOSS FROM OPERATION (12,439) (8,163) (57,892)
------------ ------------ ------------
OTHER EXPENSE
Interest expense-related party 240 100 974
------------ ------------ ------------
TOTAL OTHER EXPENSES 240 100 974
------------ ------------ ------------
NET INCOME (LOSS) $ (12,679) $ (8,263) $ (58,866)
============ ============ ============
BASIC EARNINGS PER SHARE $ (0.00) $ (0.00)
============ ============
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 26,200,000 26,200,000
============ ============
The accompanying notes are an integral part of these financial statements
3
Free Flow, Inc.
(A Development Stage Company)
Condensed Statements of Cash Flows
(Unaudited)
--------------------------------------------------------------------------------
October 28, 2011
3 months 3 months (inception)
Ended Ended through
March 31, March 31, March 31,
2014 2013 2014
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(12,679) $ (8,263) $(58,866)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Amortization expense -- -- 5,000
Depreciation expense 57 57 480
Changes in operating assets and liabilities:
Increase (Decrease) in accounts payable and accrued liabilities 9,187 960 12,127
(Increase) Decrease in other receivable
Increase in accrued interest 240 100 974
-------- -------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (3,195) (7,146) (40,285)
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of Equipment -- -- (1,141)
Acquisition of Intangible Assets -- -- (5,000)
-------- -------- --------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- (6,141)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Decrease in advance from officer -- -- --
Proceed from notes payable - related party 3,000 -- 25,468
Issuance of common stock -- -- 21,000
-------- -------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 3,000 -- 46,468
-------- -------- --------
NET INCREASE (DECREASE) IN CASH (195) (7,146) 42
CASH AT BEGINNING OF PERIOD 237 7,407 --
-------- -------- --------
CASH AT END OF PERIOD $ 42 $ 261 $ 42
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during period for:
Interest $ -- $ -- $ --
======== ======== ========
Income Taxes $ -- $ -- $ --
======== ======== ========
The accompanying notes are an integral part of these financial statements
4
Free Flow, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements (Unaudited)
March 31, 2014
--------------------------------------------------------------------------------
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying condensed financial statements have been prepared by the
Company without audit. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly the
financial position, results of operations, and cash flows at March 31, 2014, and
for all periods presented herein, have been made.
Certain information and footnote disclosures normally included in the condensed
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted. It is
suggested that these condensed financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's December
31, 2013 audited financial statements. The results of operations for the periods
ended March 31, 2014 and the same period last year are not necessarily
indicative of the operating results for the full years.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles in the United States of America applicable to a going
concern which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has not yet
established an ongoing source of revenues sufficient to cover its operating
costs and allow it to continue as a going concern. The ability of the Company to
continue as a going concern is dependent on the Company obtaining adequate
capital to fund operating losses until it becomes profitable. If the Company is
unable to obtain adequate capital, it could be forced to cease operations.
In order to continue as a going concern, the Company will need, among other
things, additional capital resources. Management's plan is to obtain such
resources for the Company by obtaining capital from management and significant
shareholders sufficient to meet its minimal operating expenses and seeking
equity and/or debt financing. However management cannot provide any assurances
that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plans described in the preceding
paragraph and eventually secure other sources of financing and attain profitable
operations. The accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a going concern.
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Free Flow, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements (Unaudited)
March 31, 2014
--------------------------------------------------------------------------------
NOTE 3 - NOTES PAYABLE - RELATED PARTY
Since inception the Company received cash totaling $$25,100 from S Douglas
Henderson in the form of a promissory. As of March 31, 2014 the amount due to S
Douglas Henderson was $25,100
Since inception the Company received cash totaling $368 from Nanette Myers a
non- related party in the form of a promissory. As of March, 2014 the amount due
to Nanette Myers was $368
On June 16, 2012, the Company received a $10,000 loan. This loan is at 4%
interest with principle and interest all due on June 16, 2014
On April 30, 2013, the Company received a $3,000 loan. This loan is at 2%
interest with principle and interest all due on May 1, 2015.
On June 21, 2013, the Company received a $600 loan. This loan is at 4% interest
with principle and interest all due on June 21, 2015.
On July 14, 2013, the Company received a $368 loan. This loan is at 4% interest
with principle and interest all due on July 14, 2015.
On September 6, 2013, the Company received a $3,000 loan. This loan is at 4%
interest with principle and interest all due on September 6, 2015.
On November 30, 2013, the Company received a $5,500 loan. This loan is at 4%
interest with principle and interest all due on November 30, 2015.
On January 31, 2014, the Company received a $3,000 loan. This loan is at 4%
interest with principle and interest all due on January 31, 2016.
As of March 31, 2014, short-term accrued interest is $617, and long-term accrued
interest is $357.
As of March 31, 2014, total accrued interest is $974.
6
Free Flow, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements (Unaudited)
March 31, 2014
--------------------------------------------------------------------------------
NOTE 4 - CAPITAL STOCK
The Company's capitalization is 100,000,000 common shares with a par value of
$0.0001 per share and 20,000,000 preferred stock, with a par value of $ 0.0001
per share.
On November 22, 2011, the Company issued a total of 25,000,000 shares of common
stock to one director for cash in the amount of $0.0008 per share for a total of
$20,000
On December 6, 2011, the Company issued a total of 1,200,000 shares of common
stock to Garden Bay International for cash in the amount of $0.000833 per share
for a total of $1,000.
As of March 31, 2014 the Company had 26,200,000 shares of common stock issued
and outstanding.
The stockholders' equity section of the Company contains the following classes
of capital stock as of March 31, 2014:
Common stock, $ 0.0001 par value: 100,000,000 shares authorized; 26,200,000
shares issued and outstanding.
Preferred stock, $ 0.0001 par value: 20,000,000 shares authorized; no shares
issued and outstanding.
NOTE 5 - SUBSEQUENT EVENTS
On March 13 2014, S. Douglas Henderson (the "Seller"), entered into a Common
Stock Purchase Agreement (the "Stock Purchase Agreement") pursuant to which the
Seller agreed to sell to Redfield Holdings, Ltd., a Delaware corporation (the
"Purchaser"), with a principal place of business at 2301 Woodland Crossing Dr.,
Suite 155, Herndon, VA 20171, the Twenty Five Million (25,000,000) shares of
common stock of the Registrant(the "Shares") owned by Mr. Henderson,
constituting approximately 95.4% of the Registrant's outstanding common stock,
for $255,000.
The sale of the Shares was completed on April 18, 2014. As a result of the sale
there was a change of control of the Registrant. There was no family
relationship or other relationship between the Seller and the Purchaser.
Pursuant to the terms of the Common Stock Purchase Agreement dated March 13,
2014, S. Douglas Henderson, the Registrant's sole officer and director resigned
his positions on April 18, 2014. Mr. Henderson's resignation was not the result
of any dispute or disagreement with the Registrant.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this quarterly report on Form 10-Q 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.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this report. 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. For any forward-looking statements contained in any
document, we claim the protection of the safe harbor for forward-looking
statements contained in the Private Securities Litigation Reform Act of 1995.
RESULTS OF OPERATIONS
We are a development stage company and have generated no revenues since
inception (October 28, 2011). Because of the change in control, as disclosed in
the Form 8-K files with the Commission on May 5, 2014, the Registrant is going
in a new business direction, as discussed below in Plan of Operation. The income
statements for the period ended March 31, 2014 and for prior periods, are not
indicative of the Registrant's proposed new business.
Cash provided by financing activities since inception through March 31, 2014 was
$20,000 from the sale of 25,000,000 shares of common stock to our officer and
director in November 2011, $1,000 from the issuance of 1,200,000 shares of
common stock to Garden Bay International in December, 2011, and from loans from
an officer, who is now a former officer (see Subsequent Event-Change of Control,
below), and whose loan was repaid in full. New management intends to capitalize
the Registrant as funds are needed.
LIQUIDITY AND CAPITAL RESOURCES
As a result of the change of control as disclosed in the Form 8-K filed with the
Commission on May 5, 2014, any liquid assets of the Registrant, and all
liabilities, were assumed and paid by the Registrant's former officer. New
management intends to capitalize the Registrant as funds are needed.
SUBSEQUENT EVENT-CHANGE OF CONTROL
As previously reported in a Form 8-K filed with the Commission on May 5, 2014,
on March 13 2014, S. Douglas Henderson (the "Seller"), entered into a Common
Stock Purchase Agreement (the "Stock Purchase Agreement") pursuant to which the
Seller agreed to sell to Redfield Holdings, Ltd., a Delaware corporation (the
"Purchaser"), with a principal place of business at 2301 Woodland Crossing Dr.,
Suite 155, Herndon, VA 20171, the Twenty Five Million (25,000,000) shares of
common stock of the Registrant(the "Shares") owned by Mr. Henderson,
constituting approximately 95.4% of the Registrant's outstanding common stock,
for $255,000.
8
The sale of the Shares was completed on April 18, 2014. As a result of the sale
there was a change of control of the Registrant. There was no family
relationship or other relationship between the Seller and the Purchaser.
In connection with the sale under the Stock Purchase Agreement, the Seller, who
was also the Registrant's sole officer and director, resigned all of his
positions and appointed Sabir Saleem and Fernandino Ferrara (the "Designees") as
directors of the Registrant. As a result thereof, the Designees now constitute
the entire Board of Directors of the Registrant.
As of the date hereof, the authorized capital stock of the Registrant consists
of 100,000,000 shares of common stock, par value $.0001 per share, of which
26,200,000 shares are issued and outstanding, and 20,000,000 shares of Preferred
Stock, $.0001 par value, none of which shares are issued or outstanding. Each
share of common stock is entitled to one vote with respect to all matters to be
acted on by the stockholders.
The change of control was a private transaction between the Seller and
Purchaser, and no new shares of the Registrant were sold or issued.
PLAN OF OPERATION
The Company intends to expand its business activities in the area of the
over-the-counter pharmaceutical industry. Arrangements are being worked out and
the draft contracts are being reviewed by the legal counsel, whereby Free Flow,
Inc. would become the "Managing Agent" for GS Pharmaceuticals, Inc., which owns
the rights to manufacture, market and sell HYGIENiQTM an aerosol treatment that
eliminates and repels smoke odor, mold and mildew from car and home. Two videos
can be viewed at www.HYGIENiQ.com. GS Pharmaceuticals may be deemed an
"affiliate," by reason that Sabir Saleem, is the CEO of GS Pharmaceuticals, Free
Flow, Inc.'s new CEO and controlling shareholder.
Free Flow, Inc. is also negotiating to be the assignee of an agreement that GS
Pharmaceuticals, Inc. has entered into with an international auto dealership in
India, to form a joint venture to manufacture and use an estimated 100,000 cans
in-house of the HYGIENiQ. The dealership sells over 100,000 automobiles a year.
Free Flow, Inc. will own and control the Indian company (under formation) to
manufacture and sell HYGINiQ in India.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
GOING CONCERN
Our auditor has issued a going concern opinion. This means that there is
substantial doubt that we can continue as an on-going business for the next
twelve months unless we obtain additional capital to pay our bills. This is
because we have not generated revenues and no revenues are anticipated until
sales are generated. There is no assurance we will ever reach that point.
9
ITEM 4. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Management maintains "disclosure controls and procedures," as such term is
defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the
"Exchange Act"), that are designed to ensure that information required to be
disclosed in our Exchange Act reports is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission rules and forms, and that such information is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure.
In connection with the preparation of this quarterly report on Form 10-Q, an
evaluation was carried out by management, with the participation of the Chief
Executive Officer and the Chief Financial Officer, of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Exchange Act) as of March 31, 2014.
Based on that evaluation, management concluded, as of the end of the period
covered by this report, that our disclosure controls and procedures were
effective in recording, processing, summarizing, and reporting information
required to be disclosed, within the time periods specified in the Securities
and Exchange Commission's rules and forms.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
As of the end of the period covered by this report, there have been no changes
in the internal controls over financial reporting during the quarter ended March
31, 2014, that materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting subsequent to the date of
management's last evaluation.
10
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS
The following exhibits are included with this quarterly filing. Those marked
with an asterisk and required to be filed hereunder, are incorporated by
reference and can be found in their entirety in our original Registration
Statement on Form S-1, filed under SEC File Number 000-54868, at the SEC website
at www.sec.gov:
Exhibit No. Description
----------- -----------
3.1 Articles of Incorporation*
3.2 Bylaws*
31.1 Sec. 302 Certification of Principal Executive Officer
31.2 Sec. 302 Certification of Principal Financial Officer
32.1 Sec. 906 Certification of Principal Executive Officer
32.2 Sec. 906 Certification of Principal Financial Officer
101 Interactive data files pursuant to Rule 405 of Regulation S-T
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.
Free Flow Inc.
Registrant
Date May 20, 2014 By: /s/ Sabir Saleem
--------------------------------------
Sabir Saleem, Chief Executive Officer,
Chief Financial and Accounting Officer
1
